Friday, August 2, 2013

France Blocks Sales of Mercedes-Benzes, Raising Concerns of Protectionism

Mercedes-Benz star illuminated

Just a few weeks before Christmas in 1982, the French government intentionally created a video recorder shortage. High-quality, lower-cost Japanese electronics were killing the French manufacturing industry, but treaties prevented banning the imports outright or tacking on giant taxes. So with a stereotypical I-don't-know-what-you-are-talking-about shrug, then President François Mitterrand designated a particular customs office as the sole processing station for Japanese VTRs. It was nowhere near any shipping ports. The office employed nine inspectors. By early 1983, 500,000 Japanese recorders were sitting in warehouses, interminably awaiting inspection.

Fast-forward, if you forgive the pun, to the present day. You'll again find the French government led by the employment-committed Socialist party, holding tremendous investments in failing manufacturing companies, and wondering what the heck to do. And then consider the French government's decision to ban Mercedes-Benz from selling cars in France—twice.

Officially, the French government is just following a new EU regulation that bans use of air-conditioning refrigerant R134a  (a global-warming gas 1,400 times more potent than carbon dioxide) because of environmental concerns. Mercedes-Benz, complaining that the replacement is toxic and flammable—and noting that the old stuff is in virtually every car on the road—was given an extension on the changeover by German regulators until 2017. Unfortunately for Benz, the French didn't recognize the extension, and ordered sales halted.

Facing half of its lineup becoming verboten, Benz raced to court. Judges ordered that France lift the ban until the issue was resolved by the EU, and the French promptly said "Mmmm, non." Citing one of the many overcomplicated laws in the European Union, the French banned Mercedes-Benzes yet again.



As inane as the whole episode seems, the French are in the right: Mercedes-Benz's cars aren't compliant with the regulations. And even if it's just air-conditioning refrigerant, that's enough reason to block a major German automaker from selling its cars in France. Thirty years ago, the French backed down on the video recorders, won concessions from the Japanese, and saw their electronics manufacturing go bust anyway. Even if this forces Benz's hand, the move won't do anything to save the free-falling French auto industry, either.



from Car and Driver Blog http://blog.caranddriver.com




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