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Dealers edge towards Mercedes agreement

Mercedes-Benz dealers were this week believed to be close to a settlement with DaimlerChrysler UK over mass franchise terminations after holding closed-door talks in Coventry.

The action group's steering and negotiating committee is understood to have recommended compromise proposals to dealers in a bid to resolve the seven-month dispute before the High Court ruling on July 16. The group's legal firm, Allen and Overy, maintains that DaimlerChrysler's reduction of termination notices, from two years to one, was a breach of contract.

Nick Adams, managing director of Bath dealer John Tallis, said: "Dealers now need time to go away and think about any proposals. This is not the work of a minute."

Alan Pulham, National Franchised Dealers Association director and chairman of the dealers' steering committee, cautioned against a "quick fix".

He said: "DaimlerChrysler UK and those dealers involved in the legal challenge have been in negotiations. Various alternative proposals have been put forward by both parties and discussions are continuing. We are bringing the dealers up to date."

Mr Pulham said he "lived in hope" that a solution would be forthcoming.

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