Vauxhall closing auto dealerships following drop in sales

Cornelia Mascio
Aprile 17, 2018

As well as changes to its retail network, Vauxhall is also overhauling its commercial and pricing policies, which could mean an end to excessive fleet sales and cheap deals galore as the company seeks to build profits back into each vehicle.

The French-owned company is to cancel contracts with all of its 326 showrooms in the UK.

The dealership network employs about 12,000 people in the UK.

It has not said how many sites could be axed.

The company, which employs more than 12,000 people in the United Kingdom, is ending the dealer contracts as it atempts to reorganise its network.

He said while the network was profitable, he believed the new contracts being proposed to investors would boost their earnings and, at the same time, recognise the growing role of digital in the sales process.

The industry has blamed confusion over what the future holds for diesels as the government has indicated plans to rid the UK's roads of both petrol and diesel cars by 2040.

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

Brexit uncertainty has also been raised by the industry as undermining consumer confidence with people choosing to stick with their current vehicle rather than buy a new one.

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.

The move forms part of a Europe-wide effort by the new owner of the Opel and Vauxhall brands, PSA, to bolster sales and customer satisfaction while cutting costs, Vauxhall said.

Vauxhall's communications director Denis Chick said: 'We will probably lose a few retailers, ' but denied reports that a third could be cut. Two-thirds of the dealers will be offered new terms.

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