The Australian Competition and Consumer Commission will not intervene in the proposed automotive wholesaling joint venture between Pacific Dunlop and Atkins Carlyle.
Under the proposal The Distribution Group, which is owned by Pacific Dunlop, will acquire the procurement, warehousing and distribution assets comprised in the car parts business of Atkins Carlyle. A joint venture company, to be jointly owned and controlled by The Distribution Group and Atkins Carlyle will then take over the sales and marketing operations of the car parts business of Atkins Carlyle, and the Traders Auto Spares and Repco Service Station Wholesale businesses of The Distribution Group.
"In making its decision, the ACCC has undertaken a large number of market inquiries with parties at every level of the market," Acting ACCC Chairman, Mr Allan Asher, said. "On the basis of these inquiries the ACCC believes the proposal would be unlikely to result in a substantial lessening of competition in breach of s.50 of the Trade Practices Act 1974.
"It is becoming increasingly common for retailers to bypass the automotive spare parts wholesalers by obtaining product directly from manufacturers and importers. Small automotive spare parts businesses are forming buying groups to bypass wholesalers.
"The ACCC notes that a number of alternative wholesalers will continue to service the market. In the event that the merged entity attempted to raise prices, automotive spare parts retailers could turn to these alternatives.
"Car owners can choose to have their cars serviced through motor vehicle dealers. They have recently become increasingly competitive, both in terms of prices and product range. It seems that customers view going to motor vehicle dealers for 'genuine' spare parts and servicing of their motor vehicles as a viable substitute to going to the non-genuine parts after-market".
