BRUSSELS - Automakers are warning against a 'free-for-all environment' if they lose the block exemption law that allows them to control their distribution networks in Europe.
Automakers and dealers issued a position paper on October 25 to persuade European Competition Commissioner Mario Monti to leave the major components of block exemption intact.
'In a totally free-for-all environment, market forces would create a concentration on the more profitable sales and routine repairs in highly populated areas,' said Paolo Cantarella, chairman of ACEA, the European automakers' association.
He said consumers would be 'stranded for high-tech safety and environmentally sensitive repairs generally, and for most repairs in areas of low population density. This would not be a socially acceptable result.'
The auto industry must now waitfor Monti to issue a study on block exemption, which expires at the end of September 2002. Sometime in early 2001, Monti will issue his recommendations for changing or preserving block exemption.
Wolfgang Schneider, vice president of legal, governmental and environmental affairs for Ford of Europe, said: 'We're confident Commissioner Monti will do the right thing.'
See story on Page 17