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Ryan forecasts five big dealer groups

GE Capital Woodchester managing director Gerard Ryan expects revised Block Exemption to provide a further impetus to consolidation in the motor industry.

“By 2004 we might see five dominant dealer groups consolidating 1,200 outlets,” said Mr Ryan at the AM autumn conference, 'Beyond Block Exemption'. “As an independent finance house, we want a market which is fair to all.”

Point of sale finance was important to conference sponsor GE Capital Woodchester, he said, but the market was reducing as retail car buyers moved to high street lenders or paid cash.

Mr Ryan said: “The commission we paid to dealers last year – around £80m – was equal to the sum of the net profit of the UK's seven most profitable motor retail groups.

“Any changes to Block Exemption are likely to give dealers more choices. There are reasons they should choose us over manufacturers – we're hungrier, more innovative and can demonstrate our service levels are higher than theirs.”

For dealers, the main problem from Block Exemption revision was fear of change, though it was inevitable, because EC Competition Commissioner Mario Monti was impatient for it. Increased competition brought a threat to smaller retailers and their local dominance.

Mr Ryan, urging dealers to do more to retain customers, said: “Our advice is they should regard the sale of a car as the beginning of the transaction.”

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