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The effects of exemption...
Page 51
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• Even if the block exemption is abolished, we won't see the end of franchised dealers, according to Kerry McDonagh, the managing director of Daf Trucks .
He argues that the need for trucks to be maintained by professionals should ensure that dealer networks remain in existence. "A truck that breaks down unexpectedly can cost the operator hundreds of pounds in lost revenue, so it must be looked after by people who know what they are doing, and who can solve any problems quickly," he contends, Block exemption allows vehicle manufacturers to oper ate a selective distribution system. This means they can supply new and unregistered vehicles solely to their own approved outlets, and refuse to supply anybody else.
However, the European Commission might decide not to extend block exemption beyond September 2002.
"The UK government has a strong wish to see it ended because they're thinking about competition in the car market, and I do not believe that it will continue in its present format," says McDonagh. "However there is little if any pressure from truck operators in favour of the current system being scrapped."