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SMMT rejects claims of pressure on dealers

Carmakers have rejected claims by the RMI that they are bullying dealers into selling their showrooms or signing pre-emption agreements giving them the first right of purchase.

The SMMT called on the RMI to provide evidence to substantiate its allegations.

A spokesman said: “It's easy to make this type of statement, but it needs to be backed up. We and our members are working with dealers to ensure we have the best possible system of distribution.”

Alan Pulham, National Franchised Dealers Association director, said the RMI had ample feedback from small and large dealers, selling across a range of marques, which indicated the problem was getting worse. He accused carmakers of “putting emotional pressure” on dealers to sell their outlets.

“Legally it is the dealer's choice whether to sell, but the trouble is the relationship with carmakers goes beyond the legal position,” he said. “It's big versus small, with manufacturers holding the relative power.”

Mr Pulham believed manufacturers were looking with interest at DaimlerChrysler's strategy of owning Mercedes-Benz brand centres in key city locations.

“They are doing it more discretely than Mercedes because of the legal problems it faced,” said Mr Pulham.

“The driving force is Block Exemption review next year, but irrespective of this, manufacturers have a sense of insecurity. They believe that removing the variables, by moving towards vertical integration, will give them more security.”

Several carmakers, like Volkswagen, have sponsored dealer programmes where they put money into start-up sites. Others, like Seat, acquire sites in high cost areas where they have no representation and rent them to dealers. Volkswagen said it had no plans to acquire dealerships and was “working closely” with the retail network to secure the best future for dealers and customers.

Few carmakers have owned sites, and those that do, such as Renault and Peugeot, stress that they have no plans to acquire existing dealers or expand further.

A Vauxhall spokesman said the company was “taking a keen interest” in the retail developments made by other carmakers, but emphasised that a “healthy dealer network” was vital.

“We are pursuing a number of projects to ensure we maintain a strong, secure retail network,” he said.

Mr Pulham advised dealers to think seriously, and speak to the RMI, before making a decision. “The dealership is their crown jewels – it is their retirement fund,” he said.

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