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Vauxhall dealer profits improve

Vauxhall has predicted “a dramatic turnaround in the profitability” of its dealer network this year following the struggles of 2000.

Nick Reilly, Vauxhall chairman and managing director, said rising consumer demand had improved profits for dealers.

“Last year was particularly difficult and margins were cut in order to get customers into the dealerships,” he said.

“Our dealers were losing quite significantly on used cars coming back where they had negative equity. That has largely worked its way through and I think dealers have been generally good at achieving cost reductions.

“Dealership profitability has improved over the past year and I see no reason why the trend should not continue.” But Mr Reilly said the manufacturing side would not return to profit before 2002. “There is still over-capacity in the market so manufacturer profitability is under pressure,” he said.

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