A group representing retailers of car stereo equipment yesterday filed an antitrust suit against Chrysler Corp. that could affect the way all auto makers sell "options packages" to consumers.
Options packages are groupings of what car manufacturers call "popular equipment," such as automatic transmissions and AM/FM stereo radio and cassette players. Buyers seeking one feature, such as an automatic transmission, often are required to buy another option -- the stereo, for example.
Auto makers contend that the practice, used with increasing frequency, allows them to cut manufacturing costs by reducing the number of single options that must be produced and shipped.
The car makers also argue that selling options in groups reduces consumer costs for those items.
But the Car Audio Specialists Association has made a different argument in its lawsuit filed in Philadelphia at the U.S. District Court for the Eastern District of Pennsylvania. By "forcing" consumers to buy grouped options, including auto sound equipment, Chrysler is engaging in an anticompetitive practice that undermines free enterprise and drives up costs to consumers, the suit says.
The suit, which seeks unspecified damages against Chrysler and an injunction against the practice, is filed on behalf of more than 1,000 companies selling car audio equipment.
Donald B. Lewis, one of two attorneys representing the association, acknowledged that most major auto makers sell options packages, including stereo equipment, in the United States.
Lewis said, however, that the association singled out Chrysler "because it has the highest rate of installation" of factory audio equipment in new cars and trucks.
"This litigation does not foreclose the possibility of suing other companies for these practices," Lewis said.
"This lawsuit serves notice to all car companies that the Car Audio Specialists Association ... will vigorously pursue the restoration of a competitive car audio marketplace," said Dan Peterson, president of the association.
Chrysler officials said the lawsuit was "absurd."
"We deny that there is anything illegal in what CASA claims we are doing," a Chrysler spokesman said. "A car is an integrated product with many components. It's absurd to argue that that integration is a violation of the antitrust laws."