Leading British supermarket chain Tesco yesterday told the Daily Telegraph that it was “excited” about the European Commission’s planned reform of car retailing regulations, which the company believes will enable it to sell cheap cars to British motorists.
Tesco has already been active in other non-food consumer goods segments, offering “parallel import” name-brand electronic and electrical goods in competition with established retailers. But it recently lost a High Court challenge against the manufacturer of Levi’s jeans which had blocked it from importing the clothing from outside Europe.
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Draft proposals, published by the EC this week, represent a significant watering-down of the “block exemption”, which has enabled car makers legally to bypass competition regulations for 20 years, the Daily Telegraph said.
Once manufacturer-imposed restrictions on what dealers can sell their cars where are removed, continental European dealers, whose cars are up to 12 percent cheaper, will be able to advertise their prices and set up delivery points in the UK for the first time and British dealers will be able to resell cars to third-party retailers such as supermarkets, the newspaper said.
Tesco told the Daily Telegraph: “We have a track record of entering competitive markets and bringing down prices.”
The newspaper said that manufacturers have begun lobbying European Commissioners to tighten up the proposals before they come into force on October 1.
BMW GB sales director Michael Gnal told the Daily Telegraph: “We are always regarded as being privileged, but car retailing is already subject to competition.”
