Car makers can now offer fleet buyers better terms than dealers

Car makers are free to offer fleet customers better terms than dealers buying the same number of cars, after the Supply of New Cars Order 2000 was revoked on 4 November. The Competition and Markets Authority decided that new entrants and online selling had made the market competitive enough to retire a rule in force since 1 September 2000 (revocation order, 4 November). The body representing franchised dealers says the order was ineffectual.

What the order banned

The order came out of the Competition Commission's April 2000 investigation into new car supply. That inquiry found a complex monopoly in favour of 17 suppliers that each held more than 1% of the market and together accounted for 94% of UK registrations (CMA final decision, section 17). It also found UK new car prices were 10% to 12% higher than in Germany, France and Italy, with fleet discounts reaching 35% while private buyers typically negotiated 7% to 8% (BBC News, 10 April 2000).

The central prohibition was narrow. A car maker could not treat a fleet customer and a dealer buying outright differently, without justification, for the same or a similar number of cars over a similar period. A fleet meant 25 or more cars registered as used by the same person (Supply of New Cars Order 2000, article 1). Suppliers also had to tell dealers at least every three months the terms and discounts available for outright purchase, so a retailer could see what a comparable volume was worth (article 3).

Three further bans followed. Car makers could not favour contract hire companies that passed cars on to fleet customers, could not withhold supply or vary credit, discounts, bonuses and delivery terms because of the price a dealer advertised, and could not use agreements that deterred dealers from importing new cars from other EC member states (CMA final decision, section 17). The order also required suppliers to publish how many cars they had pre-registered and restricted bonuses linked to that stock.

Why the CMA removed it

The CMA began a strategic review of 33 market remedies in January. Its final decision on 4 November removed 23 remedies, removed two in part and kept six (CMA, 4 November). The Supply of New Cars Order was one of nine revoked in full by the same order.

For this remedy, the CMA found the market had changed enough to make the specific prohibitions unnecessary. It cited the entry and expansion of manufacturer groups in the UK, and SMMT data showing imports from China, including Chinese brands, at just over 1 in 100 registrations in 2020, more than 1 in 8 in 2025 and approaching 1 in 5 in the first half of 2026 (CMA final decision, section 17). It also cited online sales channels and platforms.

Volkswagen was the only respondent to the January consultation, and it argued for removal. It told the CMA that the order predated digital sales channels and that block exemption orders introduced in 2022 and 2023 now cover the ground. The CMA rejected that part of the argument. "In our view the current regulatory framework does not replicate the specific restrictions imposed by the Order," it wrote (CMA final decision, section 17). The revocation removes protections rather than transferring them to another regime.

One reply, and none at the second stage

The CMA received one response to its launch consultation on this order, from Volkswagen, plus additional market information from the SMMT. It received no responses to its provisional decision in August (CMA final decision, section 17).

The National Franchised Dealers Association did not mourn the order. In a statement on 6 November, chief executive Sue Robinson said it had been "frequently criticised as an ineffectual protection for dealers". She went further: "The drafting of the Order was simply too loose." The association says removal may cut compliance burden and that the effect depends on what manufacturers do next. "Much will depend on how manufacturers react and the NFDA will maintain a watching brief," Robinson said (NFDA, 6 November).

The order's protections were specific, and the CMA has confirmed that general competition law does not reproduce them. It still bans anti-competitive agreements and the unlawful imposition of fixed or minimum resale prices (AM Online, 9 November).

Who the rule covered

Fleet buyers are not a niche. Fleet registrations accounted for 89,985 of the 152,730 new cars registered in October, a 58.9% share, and 1,090,492 of the 1,892,000 registered in the first ten months, or 57.6% (SMMT, 5 November).

Fleet customers can now be offered terms a dealer buying the same volume cannot match, without the supplier justifying the gap. Dealers also lose the three-monthly statement of purchase terms that gave them a benchmark for their own buying. A car maker can now link supply, credit or delivery to the price a dealer advertises, which the order prohibited.

Why the timing matters

The order's pre-registration rules have gone at the moment pre-registration is returning. Listings for 76-plate pre-registered cars rose from more than 2,500 at the end of September to more than 13,000 by the end of October, according to Cazana, with Volvo, Vauxhall and Audi supplying the largest volumes (Motor Trader, 9 November). The order's publication duty made those volumes visible.

The pressure behind that activity is the ZEV mandate. Battery electric cars took 32.0% of October registrations, their highest share this year, but 26.6% across the first ten months against a 33% target. SMMT expects the year to close at 27.2%, and attributes October's share to manufacturers intensifying efforts to bring registrations closer to the annual target (SMMT, 5 November).

What it means for a buyer

The practical effect is less information, not necessarily a higher price. A dealer can no longer claim the terms a fleet customer gets, and the statement of terms that showed what those quotes looked like has gone.

Two habits matter more now. Ask for the quote in writing, with the discount, the finance rate and any deposit contribution separated, then compare it with a second dealer. Ask whether a car is pre-registered, when it was registered and by whom, since the first registration starts the warranty and shapes the used value.

Dealers have less room to absorb a thinner new car margin than the accounts suggest. Nearly half of Vertu's gross profit came from its workshops in the first half, while new car retail produced the thinnest return of its divisions (Vertu interim results). Chinese brands took 23% of registrations in September, the kind of entry the CMA used to justify its decision (Chinese brands record share). The dealer relationship is also under strain on the service side, where nearly two-thirds of Jaecoo 7 faults took more than a week to repair (Jaecoo 7 repair delays).

Sources

• Competition and Markets Authority, "Strategic review of markets remedies: final decision", section 17, 4 November 2026, PDF
• Competition and Markets Authority, "Strategic Markets Review Revocation Order 2026", 4 November 2026, PDF
• Competition and Markets Authority, "CMA publishes decision in strategic review of market remedies", 4 November 2026, GOV.UK
• Competition and Markets Authority, "Supply of New Cars Order 2000", updated 4 November 2026, GOV.UK
• legislation.gov.uk, "The Supply of New Cars Order 2000", in force 1 September 2000, legislation.gov.uk
• National Franchised Dealers Association, "NFDA on the Removal of New Cars Order", 6 November 2026, NFDA
• AM Online, "NFDA adopts wait-and-see stance as CMA scraps dealer rules", 9 November 2026, AM Online
• SMMT, "Year-end push lifts EV sales but Mandate gap set to widen", 5 November 2026, SMMT
• Motor Trader, "EVs are 'most sought after' in stable used car market", 9 November 2026, Motor Trader
• BBC News, "Car report findings in full", 10 April 2000, BBC News