Price differences grow less in euro zone but increase compared to United Kingdom

Brussels, 07/02/2000 (Agence Europe) - The price difference for new cars between Member States is still considerable: 19.5% within the euro zone (where the gap is closing) and 35% including the United Kingdom, notes the European Commission in its last half-yearly report on car prices on EU markets. The analysis carried out on 1 November 1999 confirms the trends noted in the July report, namely:

• The United Kingdom remains the most expensive market despite price falls brought in by several makers. The rise of 2.4% in the pound has again neutralised the effects of price cuts.
• The price difference between euro zone countries went from 20.6% to 19.5% (17.5% without counting Finland whose taxes are the highest).
• Within the euro zone, Germany is the most expensive market for most models and Finland and the Netherlands has the lowest prices not including taxes.
• Manufacturers are reducing their profit margin so that vehicles remain attractive in the Member States applying the highest taxes: Finland and, to a lesser extent, Denmark and Greece.
• Most manufacturers (Audi, BMW, Peugeot, Renault) maintain price differences between Member States below the 20% mark from which they could lose the benefit of the "block exemption" to competition rules. Ford, General Motors and Volkswagen, however, maintain a larger difference and price differences also remain considerable for certain models of Fiat, Ford, Volkswagen (over 30% for the Polo and Golf models in particular) and for certain Japanese models.

These statistics were established on the basis of recommended price lists presented by 15 European makers and 8 Japanese manufacturers for the 77 models most sold. The Commission report is available on internet: http: //europa.eu.int/comm/dg04/aie/en/car.htm.

EUROPE recalls that the half-yearly inquiry aims to facilitate the detection of obstacles which prevent consumers from making the most of the internal market for buying their cars in another Member State. "Any violation of the European competition rules will entail immediate action", said Competition Commissioner Mario Monti, who specified that he would take into account the behaviour of manufacturers at the time of presenting a proposal to the Commission for the future legal framework of the automobile distribution system". The current framework with block exemption expires in 2002, but makers that wish to see it renewed (see EUROPE of 25 January, p.14) and consumers who want it abolished (see EUROPE of 28 January, p.15) have already taken up their campaign in anticipation of the report to be presented by the Commission by the end of the year on this subject.