Thursday 6 November 2008, 07:56

"Have a look at the dealers who are registering car in fictitious names to hit targets."

Contract hire companies and brokers have been warned that their contracts will be terminated immediately if they are caught selling on discounted new cars within three months of purchase.

Ford UK managing director Roelant de Waard told AM (October 3) that it is now monitoring websites that advertise heavily discounted cars to discover who is supplying the vehicles.

It led to the termination of several contract hire contracts
last year.

General Motors confirmed it has also “taken action” against
brokers who have breached their agreements.

Volkswagen said it has put a number of checks in place to
insure against any illegitimate business practices. 

“We would take any incidences of wrong-doing very seriously in order to protect our brand, our residual values and our genuine Volkswagen customers,” said a spokesman.

In 'serious breach of agreement'

Nissan said any company caught disposing of vehicles before the required three-month retention period would be treated as a “serious breach of agreement and more than likely (Nissan would) terminate its business relationship immediately”.

“We also make it very clear from the outset with all contract hire
companies that we have set rules regarding this area of the business and they must strictly adhere to them – no deviation is tolerated,” said a spokesman.

Reaction to the Ford story in AM included calls for more carmakers to take this kind of action, but also questions about whether contract hire companies were the worst culprits.

Establishing who is responsible

One dealer said: “Ford is looking in the wrong place – try the rental companies. Selling cars, holding on to log books for six months and then changing the owner – what chance do honest dealers have when rental companies are doing this via a few dishonest dealers just to increase their sales.”

Another poster on the AM website laid the blame on dealers themselves: “Have a look at the dealers who are registering cars in fictitious names at members of their staff’s home addresses to hit targets,” he said.

“These cars are pre-registered to hit targets but can be sold straight away. It makes a mockery of the three month pre-registered rules that they are supposed to stick to.”

The British Vehicle Rental and Leasing Association’s (BVRLA) broker committee is working to improve the industry and has established a set of compulsory standards for its members.

“The BVRLA works hard to ensure that the Block Exemption regulations are upheld across the industry.

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