This has been widely expected for some time and it should be good news for the consumer

Richard Freeman AA

Currently the block exemption rule means car manufacturers in Europe do not have to adhere to certain aspects of competition laws in the UK, and are able to tie dealers to their brands.

But they cannot stop continental dealers selling cheaper priced cars to individuals via the internet or in person.

The EU plan, due to be announced later this month, would put an end to this, leading to increased competition over prices and an inevitable drop in cost for the consumer.

Reports have shown repeatedly that British motorists are paying significantly more for their cars than their European neighbours.

Price rigging

An EU report published last July revealed that certain cars were 60% more expensive in the UK than elsewhere.

Consumer groups have been calling for a radical overhaul of the existing rules for selling cars, saying they are rigged in the interest of car makers. They have welcomed the plan.

Richard Freeman, policy spokesman for the AA, said: "Dealers will now be able to sell any number of different brands of car rather than just one.

"This has been widely expected for some time and it should be good news for the consumer."

Mr Freeman said: "Our only concern is the situation with warranties. We need to insure that consumers will still get good quality control because that was one good thing about block exemption."

Protection

Al Clarke of the Society of Motor Manufacturers and Traders (SMNT), told ITV News that the reported changes might lead to a drop in customer care currently offered by car dealerships.

"The reality is that the consumer must be protected so that when we buy a car, which at the end of the day is a complex mechanical device, there are mechanics who can service it, if it needs to be recalled for safety checks, if it needs specialist work on it, there is somebody to come back to.

"You don't achieve that level of service from somebody selling cars off the back of a transporter or just handing your credit card details over the internet."