Online vehicle sales force Vauxhall to close one in three showrooms

Marco Green
April 17, 2018

Almost one in three Vauxhall dealerships are facing potential closure in a cost-saving shake-up.

The expectation is that, in the face of falling sales (down by 22 per cent in 2017 as the overall market shrank by less than six per cent) Vauxhall plan to continue with a network of dealers closer to 200, a significant drop on the current, seemingly unsustainable, 326.

He and two fellow directors phoned every Vauxhall dealer to inform them that their franchise contract's two-year notice of cancellation will begin on April 30 and end on April 30 2020.

Stephen Norman, Vauxhall's United Kingdom boss, said staff would not lose their jobs as a "direct result" of Vauxhall's decision to streamline its network.

Volkswagen, which also has around 8% United Kingdom market share, operates a network of less than 200 dealerships, however he does not expect such a large rapid shrinkage from the current 324 vehicle sales points.

"Given what we see as the evolution in motor consumption in the next five to ten years - we have to think about the profitability of our franchising network and it is in their interests that taken this decision hard though that may be to perceive at this stage".

PSA has tasked him with turning around a United Kingdom market that saw sales fall more than a fifth previous year, as consumers curbed their spending in the wake of Brexit-linked price rises in the economy.

Vauxhall sales plunged by more than a fifth past year, which was worse then the market decline of 5.7 per cent.

The announcement comes just days after Jaguar Land Rover (JLR) said it was cutting more than 1,000 jobs which it blamed on the ongoing confusion amongst drivers over diesel engines.

Astra production has been cut by 25 per cent at Ellesmere Port despite, or perhaps because, PSA has committed to production there until 2021, but there's better news for Vauxhall Luton where Vivaro van production will increase as Luton also builds Peugeot and Citroen versions of the Vivaro.

Shadow Business Secretary, Rebecca Long-Bailey, has said the changes to Vauxhall were "deeply concerning".

People are more likely to to research cars online now and less likely to come in person to discuss the different models.

He said "We will probably lose a few retailers".

Other reports by Click Lancashire

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