Cars and the common market

  28 May 2012

Long before there was a European Union, we had a concept called the ‘common market’. Whether you believe it to be a good thing or not, the grand idea is that the whole of Europe should become one single market with the free transfer of goods and services across national borders.

Of course, for the concept to become truly reality, consumers in different national states must all start to behave the same – like the same cheeses, drink the same wines and drive the same cars.

But, consumers are not like that; which is why the European auto industry has national sales companies, cars specced for individual markets and retail groups that rarely cross national boundaries.

So, what to make of European Car Dealers (ECD), a recent spin-off from the European motor retail trade association, CECRA?

The group claims to unite 24 national motor trade associations and 12 European dealers councils to represent auto retail interests on a pan-European level. If you like, it’s the Brussels equivalent of our NFDA – and indeed the NFDA is one of its strongest and most active supporters.

In its favour, there is no doubt that franchised auto retailers need a stronger voice in the European capital.

The carmakers, through their trade association, are a highly organised and effective lobbying group. The new Block Exemption regulations are strongly biased in their favour and the retailer voice has barely been heard.

But therein lies ECD’s biggest problem; it’s a rebel without a cause. There is some talk of bringing carmakers back to the table over a binding Code of Conduct on contract length but little else to persuade the bulk of European auto retailers to join.

There are issues that ECD could get its teeth into (a pan-European version of the recent US survey on dealership standards, would be one) but it seems reluctant to make that move. Simply being a talking shop with an annual conference in a very nice venue (Verona, Italy) is not going to be enough.

For the moment at least, the jury’s out. ECD is fine in principle but needs to prove itself in practice – a bit like the common market, really.

Rupert Saunders

You can read more about ECD is the upcoming issue of Auto Retail Bulletin. If you are not already a subscriber, click the free trial button HERE

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