A lawsuit recently filed by the
City of La Crosse accuses three Wisconsin manufacturers of contributing to a scheme to fix and raise the prices of fire trucks, causing harm to municipalities across the country.
Oshkosh Corp.,
Pierce Manufacturing (a subsidiary of Oshkosh Corp.), Brookfield-based
REV Group,
Rosenbauer America LLC and the
Fire Apparatus Manufacturers’ Association (FAMA) are named as defendants in the class action complaint, which was filed Aug. 20.
The City of La Crosse accuses these companies of violating section one of the Sherman Act, which makes any “conspiracy that unreasonably restrains trade or commerce among the states" illegal.
The city argues that REV Group, South Dakota-based Rosenbauer America and Oshkosh Corp. are responsible for increasing fire truck prices and “perpetuating backlogs.” These three companies produce between 70% and 80% of all fire trucks in the U.S. market.
The city argues that fire truck prices have more than doubled over the last decade. A truck that used to cost $1 million in the mid-2010s now costs more than $2 million.
“Inflation alone does not explain these price increases, which have squeezed municipal budgets and prevented communities from replacing their old rigs,” according to the complaint.
As a result of these high prices, municipalities across the country have been using fire trucks past their life expectancy. These older trucks break down more easily and are difficult to repair, which leaves gaps in communities fire protection systems, according to the complaint.
Further, the City of La Crosse alleges these manufacturers are supported in their “conspiracy” through FAMA. Each company allegedly submits non-public economic data to FAMA, which is then sent to a consulting company and to FAMA members.
“The economic data manufacturers obtain from FAMA is not the type of information that competitors would provide each other in a normal, competitive market,” according to the lawsuit. “The manufacturer defendants use the sensitive economic data FAMA shares with them to coordinate price increases and suppress production. They also use FAMA to monitor their co-conspirators to ensure continued adherence to the conspiracy.”
The City of La Crosse alleges the companies have artificially inflated prices and that current fire truck prices exceed the amount customers would have paid in a competitive market.
The city is seeking damages in excess of $5 million and has requested a trial by jury.
None of the defendants named in the lawsuit have responded to a request for comment.
