Vauxhall to consult franchise owners over plans to reduce number of dealerships

April 16, 2018

Vauxhall will tomorrow launch a consultation with its dealers around the country about plans to consolidate sites as it battles with tough conditions for the car industry.

The British brand, bought by French car giant PSA a year ago, is examining the number of dealerships around the country as it tries to adapt to changing consumer behaviour.

As part of the integration with PSA Vauxhall is “looking at every part of the business” to find ways of “streamlining” it, a spokesperson said.

No closures or job losses will be unveiled tomorrow, although the plans will eventually result in fewer dealerships as well as the potential for further consolidation of different brands into the same locations.

Vauxhall has no powers to close down franchises, which are owned privately, although the manufacturer’s franchise board, the body representing franchise owners, is already working on plans to change the network.

Boosting profitability has become a key concern of car makers in the UK, with falling car sales alongside structural changes to the way in which consumers buy cars with the rise of the internet and personal contract purchases.

One possible option for Vauxhall may be to move more resources to pop-up shops in locations such as shopping centres.

PSA’s ownership has already shone the spotlight on the profitability of Vauxhall’s operations, with chairman Carlos Tavares last month saying the firm may hold back investment in the Ellesmere Port Vauxhall factory until after a Brexit trade deal is finalised. It is seeking to cut 650 jobs.

However, Vauxhall has since announced it will produce the next generation of its Vivaro van at its Luton site from 2019.

Source: City A.M.