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Vauxhall to terminate dealership contracts as sales plunge

By Pete Madeley | Business | Published:

Vauxhall is to scale back its dealerships amid falling sales and changes in the way that motorists buy cars.

The car manufacturer, which has a number of dealerships across the West Midlands, will issue letters to all of its UK sites at the end of the month giving two years' notice that it is terminating their contracts.

It has yet to decide which of the dealers to offer new terms.

Vauxhall's communications director Denis Chick said the car maker will change the remuneration process for dealers and introduce new standards to better reflect the changing market, as consumers do more research online.

He said: "We will probably lose a few retailers," but went on to deny reports that a third of them could be cut.

Vauxhall has the second largest number of dealerships in the UK after Ford, with 326. Among them are Evans Halshaw on Bilston Road, Wolverhampton, Go at Wednesbury and Stafford, Dudley Motor Company, Sandwell Garages in West Bromwich and Brindley Cannock.

Mr Chick insisted the firm would maintain this position after the franchising agreements have been reformed, adding: "Nobody will lose their jobs."

Around 12,000 staff are employed in franchisees' UK dealerships.

The process is also being carried out across Europe by Vauxhall's sister company, Opel.

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The decisions are understood to being made based on factors including sales performance, customer satisfaction and geographical location.

Sales of new Vauxhall cars fell by 18 per cent year-on-year in the first three months of 2018. Last year Vauxhall sold 195,000 cars in the UK.

The brand was taken over last year by France's PSA Group, whose efficiency drive has led to doubts over the future of the Vauxhall plant in Ellesmere Port, Cheshire.

Pete Madeley

By Pete Madeley
@P_Madeley_Star

Political Editor for the Express & Star. Responsible for local and national political stories, opinion, comment and analysis.

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