Automakers could risk breaking EU antitrust laws as they move toward selling cars through a so-called “agency” retail model, according to CECRA, the trade group representing European dealers.
In a news release this week, CECRA specifically singled out “non-genuine” agency dealer contracts. Such arrangements combine the traditional distribution model in which dealers control inventory and pricing and the agency model, which shifts those responsibilities to automakers.
Such hybrid contracts could be outside the block exemption from EU competition legislation that the automotive industry currently enjoys, CECRA said, describing them as a “potentially anti-competitive practice.” Penalties for running afoul of EU compeitition rules can include heavy fines.
Automakers are free to decide which distribution model they want to use, so long as they follow the contractual obligations, the group said, but they should not be allowed to “cherry pick” benefits by combining business models.
“In other words, they are not allowed to combine different models and taking advantage out of each particular system,” the release continued.
Automakers are seeking to cut their distribution costs by selling direct to buyers under the agency model. The move to the model comes against a backdrop of higher costs for electric cars, as well as a migration toward online sales that was accelerated by the pandemic.