Fleet News

Dealers in legal action threat against DaimlerChrysler UK

MERCEDES-BENZ dealers will lobby the Department of Trade and Industry for support in their battle against the decision by DaimlerChrysler UK to terminate their franchises. The dealers claim the manufacturer's decision is just the latest measure in a string of anti-competitive, anti-consumer initiatives taken by DaimlerChrysler UK.

Nick Adams, managing director of the John Tallis Mercedes-Benz dealership in Bath, said DaimlerChrysler UK had already subverted the spirit of the Supply of New Cars Order 2000 that should allow dealers to buy cars at the same prices as fleet buyers. He added: 'DaimlerChrysler wrote to us and explained that because it has to carry the extra cost of people like area managers, these costs account for the extra discount available to fleets who buy in greater numbers'.

Adams claimed that the decision by DaimlerChrysler UK to terminate all its UK franchisees at the end of this year and then to take control of 70% of UK sales would not be in consumers' interests. And with the European Commission currently reviewing the car distribution block exemption, Adams questioned whether DaimlerChrysler UK was already lining up to defeat the new regulation when the current exemption ends in September 2002.

More than 120 Mercedes-Benz dealers have joined a campaign to challenge the franchise termination order, and have thrown down a legal gauntlet to DaimlerChrysler UK to justify its actions or withdraw the emergency termination notices. The manufacturer had until last Wednesday to respond or face legal proceedings. This Wednesday (March 21), the dealers were expected to make an announcement on the decision to terminate their contracts. A spokesman said: 'UK dealers consider the notice given by DaimlerChrysler UK to be unlawful and immoral.'

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