Safeguarding competition in the aftermarket: the EC’s evaluation of the Motor Vehicle Block Exemption
The European Commission’s recently-published evaluation of the Motor Vehicle Block Exemption Regulation (MVBER) and its accompanying guidelines concludes that they have broadly achieved their objectives and remain the appropriate basis for safeguarding competition in the automotive aftermarket. This means that the current framework of rules, including its 30% market-share threshold and its lists of hardcore and excluded restrictions steering how OEM-authorised and independent aftermarket operators should compete, will remain unchanged until it expires at the end of May 2028, and it will also most likely form the basis of a renewed sector-specific set of rules thereafter.
The EC’s assessment of the way aftermarket competition has been working is generally positive, but it is qualified. It draws on a number of rounds of consultation with industry stakeholders and with member state-level competition authorities, plus a detailed fact-finding study conducted on its behalf by the EU’s own Joint Research Centre (JRC), and not to mention a considerable body of data from ICDP and others. However, a combination of limited enforcement experience under the current rules and a lack of availability of some of the hoped-for quantitative indicators means that the findings are strongly influenced by stakeholder perceptions, themselves dominated as usual by submissions from independent aftermarket operators. Their principal concern is one that has persisted for a number of years, namely that they still lack effective access to all of the so-called ‘essential inputs’ – spare parts (including software codes), tools, training, technical and diagnostic information, and in particular vehicle-generated data – that they need to compete effectively with OEM-authorised workshops (so dealers and authorised repairers), and this despite the changes that were introduced into the MVBER guidelines in 2023.
Although independent repairers (IRs) retain a substantial market presence today, the evaluation points to evidence of unequal data access, the rising costs of obtaining ‘essential inputs’, the growth of captive and software-linked parts, and other issues as all being reasons why the independents’ competitive position could weaken significantly as connected and electrified cars spread across the European parc. On vehicle-generated data in particular, the shift from repairers using standardised OBD port-based diagnostics to needing to connect to data streamed from the car to the OEM’s back-end server (and then potentially onto a third party ‘neutral’ server) is seen as reinforcing this competitive imbalance through the control it now gives to the OEMs.
The challenge facing the EC in devising its post-2028 MVBER framework will be to preserve clear, technology-neutral competition principles whilst still aligning with overlapping legislation, especially the Data Act (and its vehicle data guidelines), the updated Type Approval rules, the NIS2 cybersecurity framework, and the upcoming End-of-Life Vehicles regulation amongst others. The regulators will want to avoid giving overly prescriptive technical definitions that may quickly become obsolete, whilst giving OEMs and IAM players greater certainty around allowing non-discriminatory access to ‘essential inputs’ whilst retaining proportionate security controls. The details of how this will be handled will only emerge gradually over the next couple of years, but they will be of vital importance to the future shape of the aftermarket.
Over the next couple of years, we encourage players from across the sector to engage with the next steps in the MVBER process, which will be an impact assessment report (likely to propose different policy options) and follow-up consultation, and we will continue to report on developments as they happen both in the MVBER and in the other overlapping sets of rules mentioned above.
But in the meantime, players should also review current contracts and operational processes to ensure that the overarching principle of non-discrimination when it comes to IAM operators is being respected, from parts, software and information on the one hand, up to messaging to customers around their right of choice during the warranty period on the other – and this, despite the obvious commercial pressure on OEMs to maximise the opportunities for the brand’s own dealers and authorised repairers. And at the same time, we see scope for much more practical thinking around the opportunities that better access to vehicle-generated data might offer to the business (whether an OEM, a dealer, an IR, a parts producer, etc.), so moving on from some of the more nebulous predictions we have seen around how huge digital services revenues might accrue from connected cars, and focusing instead on how more short-term and practical retention benefits could flow from simply knowing a bit more about the car in the gap between it leaving from its last service and arriving for its next … As ever, if ICDP can help you with any or all of this, please let us know!
This Blog forms the Executive Summary to our new Management Briefing which gives a full analysis of the MVBER evaluation. This is available for Members to download here:
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