Sunday, May 13, 2001
Fiat takes new incentive as an insult
German grocer offers cars
By Hans Greimel
The Associated Press
FRANKFURT, Germany Talk about one-stop shopping.
Customers at one of Germany's most venerable grocery store chains have been lining up for an offer to buy a shiny Italian compact car along with their weekly staples. Not only that, the chain is bundling the auto with a motor scooter, computer printer, mobile phone and camera.
Upset that its spunky little Punto compact was being rung up alongside toilet paper and bratwurst, Italian automaker Fiat went to court this week to block such sales.
The legal wrangling underlines the extremes to which stores go to win shoppers in a country where nettlesome discount laws often discourage competition and hamstring retailers trying to cash in on freewheeling capitalism.
Under the deal launched Monday by Edeka supermarkets, hard-pressed German shoppers are offered two Punto packages, each for 24,500 marks ($11,270).
Option one bundles together a Punto, a motor scooter, a computer printer, a mobile phone and a camera, while option two includes a Punto, a notebook computer, a mobile phone and a digital camera. The Punto alone, which comes equipped with air conditioning, has a sticker price of 23,000 marks ($10,580).
The offer is available over the Internet and at stores in the southern German state of Baden-Wuerttemberg through the end of the month. Customers must pay within three days of ordering and travel to Berlin to get the cars.
Internet demand was so high that the server crashed twice be fore noon on the first day the deal was launched. But Edeka spokesman Duschan Gert said it was too early to say how many solid orders the supermarket had received.
Undeterred by Fiat's court petition, Mr. Gert assured Tuesday: "The sale goes on!"
Fiat says the sale undermines the automaker's sales network in Germany and that Edeka has no legal contract allowing it to sell the cars.
"We have no interest in selling through a supermarket. That would kill our own sales network," said Fiat spokesman Thomas Casper. Mr. Casper added that customers could get a better deal on a new Punto by trading in their old car at a regular dealership.
The Offenburg state court that received the petition could not say when a decision would be reached. But the case seems stacked against Edeka.
For starters, the offer is set to run afoul of Germany's discount law, which prohibits stores from lumping together different brands and different products under a single price tag for fear of obscuring the individual costs of the individual items.
Moreover, Edeka tried a similar ploy last year, packaging DaimlerChrylser's micro-mini Smart car in a multiproduct discount deal, but canceled after being threatened with legal action by DaimlerChrysler.
Germany's often Byzantine retail laws have long been the bane of consumers.
Last summer, U.S.-based retailer Wal-Mart was ordered by the Federal Cartel Office to raise prices that were found too low to be legal.
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