ACM delves into car dealer mergers and their impact on the sector
The recent publication of a set of guidelines by the Netherlands Authority for Consumers & Markets (ACM) sheds light on how the regulatory body evaluates mergers and acquisitions within the car dealership industry. These guidelines offer valuable insight for car dealers regarding the process of notifying the ACM about mergers, specifying the required information to ensure a comprehensive assessment of market concentrations. Through this framework, the ACM aims to streamline the evaluation process for assessing mergers for both the regulator and the companies involved.
The impetus behind these guidelines stems from the surge of mergers and acquisitions within the car dealership sector in recent years. The vibrant competition and the need for economies of scale in the automotive industry have prompted over fifty reported consolidations within this sector since 2019. This drive towards consolidation coincides with the industry’s shift towards offering a broader array of services beyond the sale of passenger cars, including maintenance, repairs, and the distribution of original parts. The guideline aims to discern whether mergers and acquisitions within this domain pose any detrimental effects on the market by outlining a systematic method for evaluating their impact on these crucial business activities.
The ACM has formulated these guidelines based on thorough market analyses and recent studies. Notably, in 2024, the regulator conducted a detailed investigation into the consequences of takeovers in the sector, focusing on maintenance, repairs, and the sale of original car parts. One significant case that prompted this scrutiny was the acquisition of BMW and MINI dealerships, which prompted the ACM to assess the market positions of the entities involved. Additionally, the ACM undertook a wide-ranging market survey on new passenger car sales in the Netherlands, incorporating consumer research to understand buying behaviors, analyzing sales data, and examining consumer preferences regarding traveling to buy a new car. Consultations with various industry organizations and companies provided invaluable insights into the evolving market landscape.
The guidelines offer a comprehensive summary of the findings from this market research, highlighting key aspects of the competitive landscape for car dealers. The ACM stresses that this information is not only pertinent to regulators but also essential for companies contemplating mergers or acquisitions. One key objective of these guidelines is to alleviate the administrative burden on companies by furnishing a systematic, step-by-step overview of the analyses necessary when submitting a concentration notification. The regulatory body has introduced threshold values to preclude companies from furnishing excessive data. Companies falling below these thresholds need only conduct a basic analysis of market shares at national and provincial levels. Exceeding these thresholds necessitates more comprehensive analyses to evaluate market implications effectively, streamlining the compliance process for companies.
By offering lucid guidelines, the ACM seeks to assist the car dealership industry in navigating the intricate terrain of mergers and acquisitions. The regulator anticipates fostering a transparent market environment where both companies and consumers stand to benefit from heightened competition and an array of products and services—the hallmark of a well-functioning, competitive market.
