15 May 2011

It’s an interesting reflection on the current state of auto manufacturer and retailer relations that there is so little awareness of upcoming deadlines for new sales contracts under the 2013 block exemption.

We know of at least one regional dealer meeting where retailers were surprised to see the heavy-hitters from headquarters turn out for the evening – usually it’s just the regional team. Only later did it dawn on them that it might have been a bit of a fact-finding mission prior to contract negotiations.

Of course, as Miles Trower points out in the latest issue of Auto Retail Bulletin, there actually is no deadline at all. The carmakers could simply roll over the existing sales contracts when the present legal framework comes to an end on May 31, 2013; but that would concede to franchised retailers many of the freedoms to trade that currently exist and which will disappear in two years time.

Here’s a quick reminder of the most important ones: the right to multi-franchise, the right to sell the franchise (to another authorised retailer), the right to independent arbitration, the right to minimum notice periods.

The carmakers have been quietly ‘tidying up’ their networks in the last 18-months or so, basically in preparation for this moment. Under the present two-year notice period, they have to know by the end of this month who will be ‘on-board’ in 2013 or go through the process of declaring it necessary to re-organise the whole of the network.

So, most of you will know by now whether you are in or out – and the terms under which you will be working. If you’re happy with that, fine. If you’re not happy with that, or feel you don’t understand exactly what’s going on, talk to your dealer council or a specialist lawyer. It’s not up to me to stir up trouble where it doesn’t exist, but I can’t help feeling that the silence on the issue indicates more than just meek compliance.

Have you got a new sales contract for 2013 already? Are you happy with it? Let me know: rupert@auto-retail.com

Rupert Saunders