FTC to Host Public Workshop Examining the U.S. Auto Distribution System Workshop Will Explore Competition, State Regulations, and Emerging Trends in the Industry, Project No. P131202
Automobile distribution in many States is restricted in explicitly anti-competitive ways by forcing dealer franchisees to be used for sales and even service. That protects only corporations, often very large ones against consumer interest. Further it precludes innovation by manufacturers disallowing specialized manufacturer support directly to end user. Large corporate and many government buyers are similarly precluded from direct manufacturer purchases. In many cases those purchasers are precluded from multi-state sales because of these laws. The effect is to raise automotive purchase costs, cause servicing to be lower quality and higher priced. Automobile manufacturers should be legally able to choose any distribution systems they choose, whether it be one or more options. Motor vehicles should be no different than any other product.