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Ford backtracks on retail strategy

Ford has moved into direct retailing for the first time in its UK history after buying 11 of the 12 Quartic Group solus franchise sites it put into administrative receivership in October.

The takeover, under the Ford Retail UK brand, marks a complete U-turn on previous statements that it would not get involved in frontline selling other than with joint venture operations. It also contradicts Ford's policy of offloading non-core operations, which in the past year have included Kwik-Fit and the stakes in Howard Basford and Pendragon's Ford business.

Ford is likely to consider sole ownership of other customer marketing areas – including First Ford in Glasgow, also in receivership after the carmaker issued notice of termination.

It throws into doubt the company's Polar Motor Group joint venture with Jardine, which was originally touted to purchase Quartic. That deal was apparently scuppered by Jardine's shareholders.

Heartland Ford's Lichfield dealership is excluded from the deal, but the other 11 outlets, trading as Brunel Ford in Bristol, Heartland Ford in the Midlands and Atlantic Ford in Cheshire, will now be supervised by Ford Retail UK chairman and CEO Chris Hayden. Jay Nagley, managing director of analyst Spyder Automotive, believes the Quartic deal could be a one-off territory protection initiative rather than a UK retail template.

“It's hard to believe that Ford in Britain, post Jac Nasser, is proposing to get involved in direct retailing having stepped away from non-core activities such as Kwik-Fit,” he says. “Manufacturers that have in the past been tempted to show dealers how it should be done have made a complete cock-up of it and quickly sold them on.

“The Quartic deal more likely reflects the problems bigger car companies are facing with keeping inner city dealerships when they are located on prime commercial property sites. Selling the sites to a supermarket can often be a more attractive proposition than investing to keep up with the car manufacturer's franchise requirements.”

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