Manufacturers have issued a plea of 'not guilty' to dealer claims of discrimination over discounts on new cars.

The Office of Fair Trading is investigating complaints that some dealers are not being allowed to buy cars on the same discount terms as fleets, but Britain's big three fleet manufacturers have defended their record.

The investigation comes at a difficult time for the industry, which is attempting to convince the European Union to renew from September 2002 the Block Exemption, the rules which allow manufacturers to sell cars exclusively through dealerships.

In addition new car sales are recovering from the showroom boycott last year as buyers waited for the outcome of the Competition Commission inquiry. If the Office of Fair Trading finds in favour of the dealers it could sabotage the recovery of new car sales as buyers wait to see what happens next and antagonise European Union leaders.

Vauxhall's sales operations manager Keith Michaels, who believes the complaints have been lodged by the larger dealer groups and are not representative of the majority of dealers, said: "We have heard from the OFT that a small number of complaints have been received about our discount matrix. But we have yet to meet with the OFT so we don't know who the complainants are or whether it is about dealer discounts or the whole equivalency terms offered."

But Mr Michaels said: "We are completely transparent in our policy and we don't feel there is any issue to answer."

Peugeot fleet and leasing director John Taylor said: "We have heard nothing from any of our dealers about the fact that they are complaining or are unhappy with what we are offering. If any of our dealers have gone to the OFT and complained they have not spoken to us about it."

Dealers continue to benefit from manufacturer support in many areas such as finance, marketing and training and the value of that is taken into account when agreeing discounts on vehicle supplies.

Mr Taylor said: "If that support is worth 15% and we have given a fleet customer 16% the dealer will receive a further 1% discount on an identical volume and mix of vehicles. We have tried to be as clean as we possibly can."

It is understood that Ford is defending its record, saying that it has taken the issue 'enormously seriously' and believes it has complied totally with the order.