Opel and Mercedes-Benz raided over 'price-fixing'

European Commission competition inspectors have carried out dawn raids on the offices of the German car makers Mercedes-Benz and Opel in connection with allegations of price- and distribution-fixing, EU officials revealed yesterday.

Brussels sources warned that both companies could be stripped of their exemptions from EU rules that ban exclusive distribution arrangements if inquiries produce evidence of illegality.

The raids followed complaints from consumers who were repeatedly blocked when they tried to purchase the models they wanted in countries where they can be bought most cheaply. It is understood that complaints allege breaches of the EU's 1995 ruling on car distribution. This permits restrictive dealership and servicing agreements between manufacturers and sales outlets but only subject to strict conditions aimed at giving car buyers more opportunity to shop around to take advantage of the single European market.

EU competition Commissioner Karel van Miert renewed the car industry's longstanding "group exemption" from normal competition rules in June 1995 but insisted on giving dealers greater independence from manufacturers and specifically banned any impediments to the right of consumers to purchase a car anywhere in the Community.

News of the crackdown on Opel and Mercedes came as the Commission complained that so-called parallel trade in cars, which occurs when nationals of one EU country opt to buy a vehicle in a cheaper country, is being blocked in Belgium, Germany, Spain and the Netherlands.

Price comparisons of the EU's 75 best-selling models released by the Commission yesterday shows a gap of more than 20 per cent between the lowest and highest prices for 40 cars. On 1 November list prices varied most for Fiat, Ford, Opel, Citroen, Volkswagen, Nissan and Mitsubishi cars. And prices for some small cars varied by more than 30 per cent.

Britain has joined the ranks of the most expensive member states in which to buy a car according to the survey. The Commission says this is due to price hikes by manufacturers and the rise in sterling's value.

Fifteen of the 75 models looked at were most expensive in the UK including the Opel Corsa and Astra, the Peugeot 106 and 306, and the Renault Megane. Britain was cheapest for only three models: the BMW 730i and Volvo's 850 and 960.

Buyers will find no bargains in Germany or France which had the highest list prices in the EU. Both countres each had 30 of the dearest models. By contrast, the Netherlands and Portugal are the cheapest countries for cars.

The list price for an Opel Astra in Britain was 32.8 percentage points higher than for the equivalent in Portugal. The difference is attributed to exchange rate-induced price increases.

The Commission's six-monthly car price surveys aim to highlight the opportunities for parallel trade and to pressurise car makers into creating a genuine single market.

Volkswagen and its subsidiary Audi are already under investigation for alleged malpractice in relation to pricing and distribution.