Fleet News

Co-ops will pay dividends

CO-OPERATIVES may be the way to save smaller, rural dealerships from extinction as changes brought in by the discount structure required by the Competition Commission's New Cars Inquiry take hold, Renault suggests. Keith Hawes, director of fleet and commercial vehicle operations, agrees big groups will have a major buying power advantage over minor players, although he believes price is a less sensitive issue in rural areas and customers will still need local services.

The French car maker owns 19 dealerships in its 300-strong UK franchised network, and these, sited in London and regional capitals, are responsible for a quarter of its sales. But outside principal cities, Hawes is advocating a market area franchise approach, where groups of dealers can use joint volume to command competitive discounts and maintain profitability and the necessary investment in showroom, service and bodyshop facilities.

'We are behind the franchised network,' said Hawes. 'It is not our strategy to go out and buy dealers, nor is it our intention to kick dealerships out of existing markets.'

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