The German economy minister Werner Mueller has written to the European Commission to voice German government opposition to EU plans to scrap the exclusive distribution networks of car companies in Europe, Financial Times Deutschland reports.


It is a sign that the German vehicle makers are making significant headway in their lobbying efforts.


The newspaper report says that the letter, sent yesterday to the EU Commission, proposed changes be made to the EU proposals, which would be used as the basis for a new law which will end the 15-year-old ‘Block Exemption’ to competition rules in September this year.


Financial Times Deutschland said Mueller was also against the EU plan to open up competition in sales and repair. Further, he was also against the plan to allow dealers that have exclusive contracts with a particular carmaker to sell other car brands, it said.


Commission proposals on car distribution are due to be published at the end of January and are expected to result in the end of the ‘Block Exemption’ to competition rules that allows carmakers to control European distribution through a network of captive dealers. But some elements of the existing system could be retained.


Earlier this week, Jean-Martin Folz, chairman of PSA Peugeot-Citroën, warned that changes to car distribution in Europe threaten to undermine the link of responsibility between the manufacturer, dealer and customer.


The vehicle manufacturers are currently lobbying hard to get forthcoming changes to Block Exemption watered down as far as possible.