Van parts relief?
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IT VAN users could benefit, as and Mergers Commission IV1MC investigation found 22 manufacturers together plied at least a quarter of the I number of parts in the UK, insist that customers should iin parts only from them, or sources approved by them.
le Commission said this was nst the public interest as it Ls the number of component tufacturers which can corn! with one another and with manaufacturers and importIt also restricts price compen, imposes some limits on level of service from which Franchised sector of the marcan benefit, and restricts 'petition among motor fac le 22 manufacturers deled their monopoly by say:hat their vehicles should be as part of a package, and consumer choice, safety, warranties were protected le status quo.
le Commission disagreed, said there were too many gse effects to justify this ment. But it warned that the if the Government acts on a Mo no inquiry into the car parts market. mere removal of these buying requirements would not result in any sudden dramatic change in the pattern of trade, as franchised outlets would continue to buy mainly from the car manufacturers and importers.
Therefore, the Commission recommended that the clause in the franchise agreement forcing customers to buy parts only from the manufacturers and importers should be excluded.
If this recommendation were taken up, it would still be possible for franchise holders to ensure exclusive, or near exclusive, buying of their parts by other methods. If this led once more to an anti-competitive market, then the company could be investigated under the appropriate provisions of the 1973 Fair Trading Act.