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Exemption 'best for all', claims industry

Retail Motor Industry Federation chief executive David Evans this week took a Block Exemption message to Brussels: “It's best for consumers, manufacturers and dealers.”

He was talking before Acea (representing carmakers) and Cecra (the dealers' organisation) launched a 'joint protocol' setting out their views to EC officials. Mr Evans is secretary of Cecra.

Mario Monti, EC commissioner responsible for competitiveness, will be difficult to convince Block Exemption should stay the same.

Officials of manufacturer and retailer trade organisations in European countries have urged the need to speak with one voice.

But the protocol is perceived by some industry executives as disguising many of the differences between dealers and manufacturers.

Sir Richard Branson, head of Virgin, which has extensive online sales interests, threatened to take the Commission to court. He believes officials are too compliant to the wishes of manufacturers.

He complained at the Birmingham motor show that he was being obstructed by manufacturers in attempts to buy stock for Virgin Cars.

Main points of the protocol are that a free-for-all would create a concentration on the more profitable sales and routine repairs in highly populated areas.

The document adds: “Consumers would be stranded for high-tech, safety and environmentally sensitive repairs generally, and for most repairs in areas of low population density. This would not be a socially acceptable result.” The motor industry accord argues that the European motor distribution system “is one of the most efficient in the world”. European motor vehicle distribution costs are “close to those in the US and below those in Japan”.

Lean manufacturing, lean distribution and internet capacities “will continue to drive down costs,” the document says.

Acea and Cecra argue in the protocol:

  • The existing selective and exclusive distribution and servicing system has worked well. It represents the best option for competition, consumers, dealers and manufacturers.
  • Vehicles cannot be treated like “normal” consumer goods: they cost far more than other consumer goods, have far-reaching safety repercussions and the integrity of the environment. They require expert maintenance and repair, not always in the same place.
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