BBC NEWS Americas Africa Europe Middle East South Asia Asia Pacific
BBCi NEWS   SPORT   WEATHER   WORLD SERVICE   A-Z INDEX     

BBC News World Edition
 You are in: Business  
News Front Page
Africa
Americas
Asia-Pacific
Europe
Middle East
South Asia
UK
Business
E-Commerce
Economy
Market Data
Entertainment
Science/Nature
Technology
Health
-------------
Talking Point
-------------
Country Profiles
In Depth
-------------
Programmes
-------------
BBC Sport
BBC Weather
SERVICES
-------------
EDITIONS
Wednesday, 17 July, 2002, 13:08 GMT 14:08 UK
Q&A: Car dealership reforms
The European Commission has adopted new rules on how cars are sold, designed to give consumers more power.

BBC News Online investigates what it means for Europe's car buyers.

What are the key changes?

Dealers will be allowed to sell cars of more than one marque in the same showroom.

So a single shopping trip to one dealership could replace three separate visits to showrooms to chose between, say, that Saab, BMW or Audi.

And, when trouble strikes, you will be able to go to a wider range of authorised repair outfits rather than being forced to trek back to the branded showroom.

But dealers will no longer be obliged to provide repair services.

That sounds more convenient. But will cars get cheaper?

Yes, in theory. More outlets selling a wider variety of cars means more competition.

And the European Commission thinks that should bring car prices down.

It will also make it far easier to set up car supermarkets, again increasing competition.

Consumer groups have been lobbying for years against the privileged position of the car makers who control outlets, and thus prices.

That sounds even better. So why are the changes controversial?

The changes divert considerable control from car manufacturers to dealers.

Car makers argue that their profits will be squeezed unfairly.

And they say that the rise of car supermarkets would kill off smaller dealerships, in a move that will actually harm consumers.

They also say that having a wider range of companies offering repair services and using different parts will reduce the standards of repairs.

Politicians in countries with burgeoning car industries have also expressed concern about the impact of the changes.

German Chancellor Gerhard Schroeder has been particularly vocal, keen to defend the country's manufacturing sector ahead of September's general election.

When will the changes come into effect?

From October onwards, all dealers must choose whether to be selective or exclusive.

Car makers then have a year's grace to comply, and start supplying new outlets.

But one key liberalisation has been delayed at the last minute.

The introduction of controversial measures giving dealers the right to open showrooms anywhere in the 15-nation European Union, from Aberdeen to Athens, has been put back a year to October 2005.

That means the disparity between car prices in different countries may not equal out just yet.


Companies

Background
See also:

17 Jul 02 | Business
Internet links:


The BBC is not responsible for the content of external internet sites

Links to more Business stories are at the foot of the page.


E-mail this story to a friend

Links to more Business stories

© BBC ^^ Back to top

News Front Page | Africa | Americas | Asia-Pacific | Europe | Middle East |
South Asia | UK | Business | Entertainment | Science/Nature |
Technology | Health | Talking Point | Country Profiles | In Depth |
Programmes