Japan’s Fair Trade Commission has issued an advisory to a Toyota subsidiary for unfair treatment of subcontractors. It said the company had violated the subcontract payment law and told it to take steps to prevent a recurrence.
Toyota Customizing & Development reportedly forced nearly 50 subcontractors to keep hundreds of items in storage without paying the required fees.
The Commission says the firm also did not conduct inspections on delivered parts. It then made returns that could not be justified. This caused suppliers to incur some 54 million yen in losses, or about 336,000 dollars.
The Fair Trade Commission says this violated the Subcontract Act and told the company to implement preventive measures.
The firm held a news conference in Tokyo, admitting to the facts. It said it has covered the full amount of losses caused by the unfair returns and that it will pay storage fees to the subcontractors keeping its parts.
The Fair Trade Commission also issued an advisory to Nissan Motor in March for unfairly cutting prices to be paid to 36 suppliers.
The watchdog has been keeping a close eye on business deals in the auto industry as manufacturing costs remain high.