Fleet News

MMC to investigate discounts to fleets

THE Monopolies and Mergers Commission will investigate fleet discounts as part of a major, wide-ranging inquiry into the UK motor industry. John Bridgeman, director general of the OFT, believes the superior buying terms enjoyed by fleets which purchase no more vehicles than dealers is 'a major market distortion'.

He has ordered the MMC to investigate the relationship between car manufacturers and dealers, after the OFT's own seven-month investigation into the £24 billion a year industry found evidence of practices which distorted competition. The MMC inquiry will add fuel to the fire started by MPs on the Department of Trade and Industry's Vehicle Pricing Committee who called for the Government to 'name and shame' fleets which achieve massive discounts because of their buying power.

'It is clear the market isn't working properly and that there is an imbalance of power between manufacturers and dealers which is distorting competition,' said Bridgeman. 'This is characterised by suppliers' continued refusal to give volume discounts to dealers which could be passed on to the consumer as lower prices and by other practices designed to exert a strong influence over selling prices.'

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