Automotive News Europe - January 5, 2009 - 7

January 5, 2009 www.autonewseurope.com · PAGE 7 Support grows to keep retail rules Ford and GM executives say now is the wrong time to kill block exemption Hurtej Kaur Automotive News Europe Ford Motor and General Motors Europe are backing car dealers who are fighting to save Europe’s regulatory regime for car sales and repairs. The automakers are concerned that scrapping or weakening the socalled block exemption regulation will add to dealers’ troubles in the economic downturn. “The current law has worked very well in practice – this is not the time to experiment with a new framework,” said Wolfgang Schneider, Ford of Europe’s vice president of legal affairs. Carl-Peter Forster, General Motors Europe president, said changing the regulation would be “ludicrous in the current situation.” The block exemption regime ends in June 2010. Europe’s lawmakers are considering whether to renew, modify or kill the regulation. In May, a European Commission report said there is “no valid reason” to renew the auto sector-specific block exemption regulation. If lawmakers agree with the finding in the report, the car industry would have to abide by the same competition rules that cover other industries. Ford of Europe Chairman John Fleming GM Europe head said: “Dealers Forster says it would be “ludicrous” to understand the regulation change retail rules. and are happy with it so let’s not change it.” Ford’s and GM’s views are the opposite of those of ACEA, the European automakers association, which has Ford and GM as members. ACEA supports the Commission’s position and calls for a more flexible regime. The current block exemption was introduced in 2003 to create fairer competition in new-car sales and repairs across the 27 EU member states. The regulation made it easier for dealer groups to open multibrand showrooms, a development many automakers opposed because they did not want to see their cars displayed next to models from rivals. It also guarantees dealers and repairers contractual rights and access Changes to Europe’s car retail rules made it easier for dealers to open multibrand stores like this one in Bolzano, Italy. to automakers’ technical data. The European dealers association, CECRA, is lobbying hard for the regulation to be kept as it is. CECRA says the regulation has helped protect dealers in their relations with automakers and abolishing it “would jeopardize all the investments that have been made for the past 10 years, particularly at a moment where the world economic order is subjected to successive crises.” The European Parliament and Europe’s Council of Ministers, the EU’s top decision-making body, will review the Commission’s report early this year and could make a decision by February or March. John Revill contributed Peugeot uses online new-car sales to combat downturn Web Store lets Internet users browse cars available at 400 dealers in France Lawrence J. Speer Automotive News Europe PARIS Peugeot will rely more on Internet marketing of new cars to help counter the economic slump. Launched one year ago, Peugeot’s French-language Web Store site (www.peugeotwebstore.com) allows Internet users to browse among 35,000 new cars available from the company’s 400-member dealer network in France. Potential buyers can look for a car they like, find the best price among participating dealers and then arrange a meeting at a dealer site to work out a sale. The French carmaker’s online operation goes much further than those run by its European rivals, which generally use the Internet as an information tool for prospective customers. Most European carmakers limit online sales to used cars. Experts say Peugeot’s Web Store offers an indication of how the Internet could affect new-car sales and carmaker-dealer relations across Europe in the near future. The US currently is the leading online car market, with about 8 percent of new-car sales taking place over the Internet, according to Xerfi, a Parisbased market intelligence company. This is double the European online sales rate of 4 percent. said Guillaume Mouren, an automotive analyst at Xerfi. “The Web Store actually helps dealers better manage their inventory, limiting the need for further incentives or passing on inventory to lowcost agents,” Mouren said. Xerfi forecasts that online sales in France will grow by 20 percent to 40 percent annually over the 2009 to 2011 period, by which time Internetbased transactions should represent 5 percent of all new-car sales. Peugeot’s French customer relationship manager, Christophe Spitalier, said the number of visitors to the Web site tripled to more than 600,000 in November after a national advertising campaign. The site was averaging 200,000 visitors over the January to October time period. Spitalier said increasing the number of potential buyers versus casual Internet surfers is key to boosting online sales. “What we learned is that targeted advertising really works when we want to create traffic among customers specifically interested in getting a good deal,” Spitalier said. One in three Web Store visitors now fills in online information forms asking for follow-up contact, up from one-in-five before the advertising campaign, Spitalier said. Anywhere from 12 percent to 15 percent of Web Store visitors who request additional information about a car actually buy a car within three months, Spitalier said. Peugeot plans to widen its online product offering this year. It is also considering ways to take online reservations and allow clients to make deposits. Said Spitalier: “Further developing the Web Store seems to be a good idea, but in the end it is still dealers ANE that sell the cars.” No negative impact “Peugeot’s decision to allow dealers to advertise the vehicles they have in stock online appears to have had no negative impact on the network,” The number of visitors to Peugeot’s Web Store, an Internet marketing site for new cars, tripled to more than 600,000 in November. Q & A: STUTTGART Hans-Georg Härter, CEO of drivetrain specialist ZF Friedrichshafen, is seeing an alarming number of the company’s suppliers heading toward financial trouble because of the global financial crisis. ZF is giving short-term loans to suppliers squeezed by the credit crunch, or paying higher prices for their components. Härter expects the economic situation to worsen in the first quarter. He spoke with Automotive News Europe Industry Reporter Bettina Mayer. What is ZF doing to support its suppliers? We are helping strategic suppliers with temporary measures such as short-term loans or paying higher prices for parts. Hans-Georg Härter ZF gives loans to its suppliers that face trouble Can you give a forecast for 2009? We are dealing with different scenarios. We do not have any reliable figures from our customers so it is very difficult for us to plan. But I guess sales will go down and that will affect employment. Will you reduce your dependence on the auto industry like Robert Bosch is doing? The automotive business is about 81 percent of our turnover and will remain our key business. But we want to expand our non-automotive business. Are you planning further investments in new technologies such as hybrid and electric drivetrains? We set up serial production site for hybrid technology in Schweinfurt, Germany, in May. The first cars will come off the assembly line of our customer this year. We also are working on alternative drivetrains including electric powertrains. Are your customers canceling or delaying joint projects with you? Some are delayed for two to three months. Some are delayed for two to three years. In the current financial situation, our customers’ projects are being prioritized and scheduled differently. But if it is a project that saves fuel, the current economic crisis has less effect on it. What about your axle and chassis plant in Russia that you planned with AvtoVAZ? The project was put on hold but now it is revived. AvtoVAZ got Renault as a new investor and they re-examined their strategy. There is no contract yet but we are very confident. I think it will be sorted out in first half of 2009. It would mean setting up a production site in Togliatti [Russia]. The investment will be somewhere in the area of a double-digit million amount. ZF’s eight-speed dual-clutch transmission will launch soon. Are you working on a nine-speed system? “We want to expand our non-automotive business.” Hans-Georg Härter We are working on options for the next generation. It does not mean that the next generation will have nine speeds. But I do not rule it out. Are you trying to make the unit smaller and lighter? We are working on weight optimization, increasing its efficiency and optimizing the installation space. ANE

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Automotive News Europe - January 5, 2009

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