Volkswagen Group UK confirms overhaul of dealer networks

Volkswagen Group UK has confirmed that it is pushing ahead with plans to remap its UK dealer networks with cuts to the number of dealer outlets and fewer investors.

The remap of the networks – described by one dealer as ‘brutal’ – impacts the brands it has in the UK, including Audi, Volkswagen Passenger Cars, Volkswagen Commercial Vehicles, SEAT, Cupra and Škoda. The process has been ongoing for some time and is part of a five year plan.

It is understood the OEM, which accounts for almost a quarter of annual UK car sales,  is looking to have all brands represented an individual group in large market areas. Motor Trader was told the overhaul is taking place win three waves, with the first round of terminations haven already taken case.

Its aim is to make saving costs and gain synergies. The plan is being driven by electrification, reduced new car sales and reduced forecast revenues from aftersales.

Investors were told about the move in meeting with individual brands with participants asked to leave their mobile phones outside the briefings.

In a holding statement a spokesman for Volkswagen Group UK, representing the brands said: “Volkswagen Group UK, and indeed the whole motor industry is moving through a period of unprecedented change, prompted by electrification, online sales and new customer expectations.

“As part of these changes, our network is also evolving, and will ultimately comprise fewer sales locations, operated by a reduced number of investors.

“From a customer point of view, we are confident that by enabling a focused and financially viable network, our dealerships we will be able to offer the highest levels of customer service, and we will work closely with any new or expanded investor partners at the dealership to ensure this is their primary concern.”

“I kind of get what they are ttying to achieve, ” one dealer told Motor Trader. “But it’s brutal.”