Almost all motor manufacturers have used the new block exemption as a reason to terminate all or many of their contracts.  Most dealers will receive new contracts, but a substantial number of small dealers are being sacked.

German publication Autowoche says VW, Audi, BMW, Volvo, Opel, Chrysler, Citroen, Daihatsu,  Skoda, Jaguar, Mazda, Peugeot and Toyota have all sent out termination notices.  There is speculation that Audi could cut up to a third of its German dealers, many of whom sell only 80 to 120 cars a year.

Uwe Brossette, a partner at solicitors Osborne Clarke Germany, who represents groups of German dealers, says: "Contracts normally carry a 24 month termination notice, but have a clause allowing termination after 12 months if there is a need to restructure the entire dealer network. Manufacturers are using this to terminate early.  We are arguing that the new exemption, in itself, is not an adequate reason for this action."

Brossette thinks the new regime may favour larger stock market chains, particularly UK companies: "The luxury car marques call for their dealers to make substantial investments which many can't afford."

The new law means that, providing a dealer meets the requirements set out by a manufacturer, it has to be allowed to sell the car.  But both Professor Garel Rhys at the Cardiff Business School and Thomas Almeroth, head of the VDIK, the German Association of Automotive Importers, downplay the extent of any change.  Almeroth says: "It costs a lot of money for a dealer to take on a new marque.  Only a few dealers want to do this, and most car makers are not very keen to see multibrand dealer sites. But it is undoubtedly true that we will see some of the smaller car dealers quit the market."