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Welcome to 

The Voice of European vehicle dealers and repairers

Representing 336,720 enterprises of automotive trade and repair businesses

What does CECRA do?

CECRA is the European umbrella organisation regrouping national automotive trade associations and European brand dealer councils

Acting as a watchdog, ensuring the interests of authorized dealers and repairers are taken into due account by European regulatory bodies

CECRA's 'Best Practice'

platform offers its members a real added value enabling them to learn more about new tendencies and best practices in place

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CECRA News

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"Obligations to be respected when choosing an agent contract" 
Brussels, 07/12/2021
During more than 100 years, the automotive wholesale model has remained mostly unchanged. The automotive manufacturers build cars and sell them to their selected network partners ‘dealers’. Dealers, investing in sales and repair infrastructures complying to their manufacturer(s) corporate identity, take care of all the sales and service activities.
 
New vehicle architectures, technologies, changing customer behaviors and new mobility concepts are transforming the entire automotive ecosystem and this wholesale model is about to change. Many automakers are turning towards agency sales models, this to combine the strengths of their widespread network of independent dealers with the benefits of more tightly managed sales processes and direct customer access. 

Peter Daeninck, Chairman of CECRA’s European Car Dealers' Division says that: “in theory, manufacturers are free to decide upon which distribution model to unroll, however, they shall respect and comply to contractual obligations of that particular distribution model put in place. In other words, they are not allowed to combine different models and taking advantage out of each particular system. We will not accept this kind of cherry-picking!”

Bernard Lycke, Director General, adds that: “we notice a trend towards manufacturers opting for an agency model. We are speaking about genuine agency contracts. Called genuine because of them being outside of the scope of the competition legislation. In a ‘non-genuine’ agency contract, vertical price fixing is not allowed.” This genuine agent model consists of appointing a ‘sales agent’, who acts in the name of and on behalf of a manufacturer called the ‘principal’. The role of the agent consists essentially in taking orders from customers and forwarding them to the manufacturer who then delivers directly to the customers at the price fixed by the principal. All financial risks and investments are borne by the ‘principal’, whereas prior, within the distribution model, the financial risks and investments were to a great extent supported by the dealers”. CECRA warns manufacturers, they shall be fully aware of this and take into account all the aspects and obligations an agent contract implies”. Although, as said, there are strict rules to comply with, we see some manufacturers becoming imaginative and a number of scenarios are emerging. We are informed that some manufacturers, having resigned their actual distribution contracts with their network and appointing agents, are requesting the latter to transform their business and to make the necessary investments. The European Commission is well informed about these practices and is following it up closely”.  

Another aspect of changing distribution models is the issue of customer database, an important asset built up over the years by independent dealers. Within the agency model, manufacturers will be in direct contact with the end customer. The customer database is therefore a crucial aspect in order to be able to unroll this model successfully. 

Indeed” says Lycke, “In the course of changing dealer contracts into agent contracts, the issue of customer transfer must be addressed prior to signing the agent contract! However, we do not hear anything about it. As it is clearly specified within the European Commission’s guidelines, this shall be respected and compensated!”, he reacts.  
 
CECRA’s President Jean-Charles Herrenschmidt concludes: “Whatever distribution model manufacturers will unroll, one fundamental aspect is that whether it is a distributor or an agent, they need an economic viable business model, otherwise the future of distributing, repairing and maintaining cars will be disrupted”.

The Frankfurt court has just ruled that the Opel dealer remuneration system in Germany is illegal. The Belgian Competition Authority received a complaint for similar facts

Brussels, 24/12/2021
In November 2020, VDOH, the Association of German Opel Dealers which is member of the European Opel Dealer Council, member of CECRA, had filed a lawsuit on behalf of its members against Opel’s so-called "Commercial Policy", which regulates the remuneration system for its authorised dealers.

According to the association, the complaint is directed against the general structure of the remuneration system, its incalculability and, above all, against the numerous unilateral possibilities for change, including intervention in the margin. 

Last week, the Frankfurt Regional Court upheld the action against Opel for its “Commercial Policy”. Opel may no longer impose a regulation on its sales partners in which the manufacturer can arbitrarily change the remuneration of its dealers consisting of a fixed margin and bonuses.

Opel Germany has already announced that it will appeal the ruling to the Higher Regional Court of Frankfurt am Main.

CECRA’s General Director Bernard Lycke said: “I very much welcome the decision of the Frankfurt Regional court as another[1] breakthrough in dealers’ decade-long struggle for more fairness. Especially in light of all current radical changes and challenges, this Court’s decision could change the margin regulations of many makes and therefore paving the way for a balanced and fair partnership in the automotive industry”.

[1] Austrian Supreme Court rules that Peugeot Austria has abused market power against independent dealers 


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Brussels, 23/09/2021

During the first plenary session, dedicated to Green Deal, the Executive Vice President of the European Commission, Frans Timmermans set out the Commission’s goal and plans for making Europe the 1st climate continent by 2050. In his speech, he addressed the audience by saying that the automotive industry and its services have an important role to play in the transition to a climate neutral future. Transport is the only sector where greenhouse gas emissions have been on the rise. The bulk of that is caused by passenger cars. To bring these emissions down, he invites the whole industry to accelerate its efforts and to increase the market share of electric vehicles. He added, as it will have a serious impact on car dealerships and repair shops, a transition plan is therefore needed. As regard the social impact, he invites the industry to share thoughts and ideas on how best workers could switch jobs.
In the role out of the charging infrastructures, an acceleration is also needed. The Commission is therefore proposing ambitious and binding targets per member state to deploy the publicly available infrastructure.
There is a real need to prepare and adapt the entire mobility system. It includes the shift towards clean transport modes like cycling and zero emission transport, as well as to review the tax systems.
Timmermans concluded by saying that he counts on the automotive ecosystem representatives to help the Commission to get a transition that will be bold and that will leave no one behind.

The ensuing debate clearly showed the will of all to move towards CO2 reduction at full speed, but that in the short transition period, defined by the Commission, hybrid cars for long journeys with light batteries that consume less CO2 and electric vehicles for short urban journeys were still necessary to carry out the transition and to have time to train new skills. The rapid replacement of the most polluting cars with subsidies for low-income households, the development of hydrogen research, the use of alternative fuels and the acceleration of the development of fast-charging systems should be the priorities. The participants therefore decided to establish a more precise schedule and a fair distribution of tasks in the coming months.

The connectivity and digitalisation, dealt with in detail within the second plenary session, evoked some intensive discussions. It goes without saying that connected in-vehicle data is key. Several associations including CECRA, the automotive aftermarket operators, mobility services and consumers developed a system called S-OTP, a secure on-board telematics platform, which allows accessing data and functions emitted by the vehicle under the same conditions as manufacturers. However, the opinions between manufacturers’ association ACEA and aftermarket players were diverging, the session ended with a rather positive note. ACEA’s Director General Eric-Mark Huitema reached out to CECRA to continue the negotiations taking into account that in the end it is up to the customer to decide upon his data.  

 

The focus of the 2nd day was put on the future automotive distribution models. Natalia Lazarova, the Head of Unit Antitrust at the Commission, set out the regulations applicable to the automotive distribution and repair sector. Both regulations are currently under review. She very much welcomed the event as through these exchanges, the Commission better understands the needs of the automotive players. The Commission is at present drafting the new rules. She invites CECRA’s members to send their comments to the last consultation round.
 
Klaus Zellmer, member of the Board of Management Sales, Marketing and After Sales of Volkswagen passenger cars, said VW has implemented an agency distribution model for specific products (e.g. electric vehicles) since one year. In order to assess tomorrow’s challenges, OEMs need to be more connected with their customers. The agency model would permit them to do so. The established network of dealers would be integrated into this new model as they have an essential role to play in the overall process of the customer’s buying process and experience. Being at the front desk, guiding and assisting customers in the technicalities and specificities of that good is fundamental.
 
Christian Bourgeon, lawyer specialized in distribution law, spoke about the legal details between a franchise and agent contract. These will further intensively be examined and discussed at CECRA dedicated working group. Nicolas Lenormant, a French truck dealer, and Jean-Charles Herrenschmidt, President of CECRA said as dealers start to make huge investments to ease energetic transition, it is highly important that new contracts would not create more precarity on their business. An exclusive distribution system or, at least a moratorium would be appreciated in this very challenging and sensitive period.

Bernard Lycke, General Director of CECRA, explained that it is up to OEMs to decide upon which distribution model to unroll. However, they shall indeed respect the contract conditions linked to that particular model put in place. As partners, manufacturers and dealers need to start off their bilateral discussions on the details of the future envisaged distribution models in order to make sure to come to a win-win situation and not to a one side approach which could lead to a demotivation of the networks and therefore result into an undesirable outcome.
 
This message was relayed by Rhett Ricard, Chairman 2020 of the American dealer association NADA and representatives of Chinese, Brazilian and Russian dealer associations which supported the European sales and repair firm standpoints and underlined the importance of dealers in their respective countries.

The assembly, through several witnesses including Thomas Martin, HR Director of the Frey Group in France, insisted on the fact that the transformation within the automotive industry will furthermore have a huge impact on jobs. Skilling, reskilling and upskilling is essential to make sure workers are not left behind. They shall be trained in conformity to the upcoming changes enabling them to perform high qualified repairs and maintenance of the future car park and by this means to ensure compliance to environmental standards and above all to guarantee road safety.
 
Francis Bartholomé, President of the French national association CNPA, underlined the same urgencies during the gala dinner speech. ‘Challenges are ahead, it is time to act and to put all actors around the table for the sustainability of all our companies and our workers”.
 
Jean-Charles Herrenschmidt, President of CECRA, said the conference has clearly sounded the alarm and the risk of not accelerating in the face of competitors who have taken the lead. It has allowed all stakeholders to start looking in the same direction in order to find efficient and cost-effective solutions in the coming months. They will be used to move forward quickly because it is time to move on and to work together to prepare the shift. Both Jean-Charles Herrenschmidt and Christophe Carignano said: "a 2nd edition of #CONNECTEurope will be organized next year to take stock of all the progress made". 

CECRA and Infopro Digital have just closed their 2-day conference on Europe’s automotive mobility #CONNECTEurope with great success. The event hosted approx. 150 participants representing European and International leaders from the up & downstream automotive world as well as decision makers from the European institutions

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Brussels, 13/09/2021
Ahead of the European Commission’s Workshop on “Access to In-Vehicle Data” scheduled on the 17th of September next, a broad coalition, of which CECRA is part, representing automotive aftermarket operators, vehicle dealers, mobility services and consumers urges the European Commission to publish an ambitious  legislative proposal on access to in-vehicle data by the first quarter of 2022 at the latest.
 
The ongoing lack of access to in-vehicle data and functions increasingly jeopardizes our ability to compete in digital products and services and to provide customers, both consumers and fleet owners/operators, with the digital services they expect. The recent TRL Study Report commissioned by the European Commission depicts these problems, which are rooted in vehicle manufacturers’ closed telematics systems. Another study, commissioned by the consumers organisation FIA Region I, showed that if this model would continue to establish itself, it could lead to consumers and independent service providers having to absorb additional costs of around €65 billion per year by 2030.
 
It is therefore time to act! After already lengthy investigations and several postponements since 2018, the draft legislation should be put in the legislative loop no later than the first quarter of 2022 to have a chance to go through the complete ordinary legislative procedure. Any delay could result in this major legislation protecting consumers and SMEs being delayed to the next terms of the European Commission and of the European Parliament, putting at risk the competitiveness and the survival of the 500.000 companies and 4,5 million jobs we represent.
 
A robust and ambitious sector-specific legislation is needed. What is at stake is too important to be handled with soft measures . A principles-based legislation underpinned by specific technical and legal requirements is needed to guarantee equal access to the vehicle, its data, functions and communication with the users. This legislation must address the systemic problems which have unequivocally been identified over the last years. It must be efficient and robust enough to remain relevant over several years. The specificities, the complexity and the importance of the automotive market require a sector-specific legislation and cannot be addressed in the broader horizontal initiatives in the framework of the European Data Strategy.
 
There is a simple solution: mandating a Secure On-Board Telematics Platform (S-OTP). The S-OTP is a set of requirements based on equipment which is already in the vehicle and on existing standards, involving no additional device. It puts the consumers/drivers in control, enabling them to freely choose which service providers have access to which technical data and for which purpose. Only services which are independently assessed, tested and approved could be chosen by the consumers. It is fully in line with the European Union’s objectives in terms of data privacy, cybersecurity, digitalisation, and enhancement of road mobility. We have published earlier this year a detailed technical description of what the S-OTP would be and how it would work, and today we release a set of videos to explain it in a shorter way. This video explains clearly how digitalisation is transforming road mobility, how the S-OTP is the perfect solution for the challenges arising from this trend, and what its benefits are for the consumers, the economy and society at large.
 
CECRA, together with the other members of the coalition, urge the European Commission to publish an ambitious and comprehensive legislative proposal on “Access to In-Vehicle Data” by the first quarter of 2022, to safeguard true consumer choice, innovation, and effective competition for digital automotive services.

A broad coalition, of which CECRA is part, urges the Commission to publish an ambitious  legislative proposal on access to in-vehicle data by Q1/2022

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