Fiat to Sue Food Retailer for Selling its Cars as Promotional Incentive

08 May 2001

Fiat Deutschland plans to take legal action against German supermarket giant Edeka for breaching the auto industry’s highly protective sales distribution system.

As from next Monday until the end of May, Edeka plans an ad campaign offering Fiat’s Punto model as part of a promotional deal. Punters can purchase their Puntos only when they also buy other items – such as computer printers and cameras – at a package deal price of DM24,500 (E12,250), equivalent to an overall discount of 25%. “We want to break a new path,” said Edeka.

The nation’s Fiat dealers are not best pleased and are insisting that the carmaker enforces the terms of its dealership contracts. According to Fiat Deutschland, it hopes to scupper Edeka's plans before the initiative is launched, either by invoking Germany’s draconian competition laws [which ban such combined deals because they cloud true price comparisons] or by seeking a temporary injunction.

Edeka hopes that its initiative will be a case of ‘second time lucky’, following an unsuccessful attempt last year to sell DaimlerChrysler's Smart car, a move promptly blocked by the carmaker.

But whatever the outcome, Edeka will have gained valuable publicity and enhanced its image as the ‘consumer’s friend’.

News source: Handelsblatt (Germany) [07-May-01]