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Online retailers plan 'fight for rights' body

Virgin Cars' chief executive Ian Lancaster is leading a move to form an association to fight for the rights of internet-linked motor retailers.

Mr Lancaster is talking to executives at other companies including OneSwoop. Traders selling grey and parallel imports formed a group to press their case two years ago.

The online association is likely to push for an end to Block Exemption because they want a liberal market. Manufacturers have launched a campaign for the retention of the franchised dealer system. Ford of Britain chairman Ian McAllister said: “I believe passionately that it would be a mistake to scrap the franchised dealer system. Research suggests car buyers are wary of multi-marque showrooms. They prefer the existing system and franchised networks operate all over the world.”

Mr McAllister dismissed suggestions the internet would change the structure of motor retailing.

“All but a few of the dotcoms will bloom and die,” he said. “I expect 80% of car buyers to use the web to gather price and product information.

“They will be far better informed than ever before but that does not mean customers will use the internet to buy cars.” Online car sales faced many barriers including difficulties arranging trade-ins. There was an imminent EU directive that would give any online shopper the right to return merchandise within seven days and get a refund.

“Purchase of any car is an involved process that is fundamentally unsuited to the internet,” said Mr McAllister. There had been no discussions between Ford and Virgin Cars about direct supply. “The law does not permit vehicles to be sold except through franchised dealers,” said Mr McAllister. “Virgin would have to meet minimum requirements including exclusive showrooms before being eligible to hold a franchise.”

The Virgin Cars spokesman said discussions continued with manufacturers about direct orders, though progress was likely to be slow until Block Exemption review in 2002. The “returns” directive was not yet UK law.

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