The largest auto company in the world and the third largest auto company in the world are proposing to join together to limit competition in a critical segment of the U.S. market.
Competition in the U.S. has already been choked off by the Japanese Voluntary Restraint Agreement. Since 1981, when the VRA took hold, the average retail selling price for all new cars sold in the U.S. has risen by 18.8 percent or $1741 more than the consumer price index. Consummation of this joint venture will reinforce this upward pressure on new car prices.
Battalions of neo-classical economists dancing on the head of a pin cannot obscure the threat that this marriage of competitors poses to the American consumer, nor the fact that this joint venture is a plain and unambiguous violation of the antitrust laws. The Commission's settlement, requiring Toyota and GM to abide by the precise terms of their illegal agreement, hardly qualifies as antitrust enforcement.
