Bill Parfitt, Vauxhall executive director of sales and marketing, has privately indicated that Saab's decision to force retailers to invest up to £300,000 in upgrading their premises was misplaced, especially for a marque that last year sold just 13,877 cars and has a 0.65 per cent market share. He is considering pulling the plug on the standalone retail network, say dealers, bringing Saab closer to the Vauxhall and Daewoo networks by encouraging multi-franchised sites. Bowers of Bolton opened the first such premises recently (see p6).
“Are the Unlimited dealers selling any more cars than the rest of us – I don't think so,” says one Saab retailer. “We can't justify the level of investment that Saab is expecting.”
But Jonathan Nash, Saab GB managing director, who now reports to Parfitt, remains confident the initiative can work. With 32 of the 90 dealers signed up since the programme was launched 16 months ago, Nash hopes the rest will be part of the scheme within two years. “Creating a retail environment that reflects the elements customers perceive and associate with the brand will help sell cars. But Saab Unlimited is not mandatory because it may not be appropriate for every dealer,” says Nash.
Under new post-block exemption contracts, retailers' margins will be based on core elements like quality, standards and whether the dealer is part of the Unlimited network. Nash refuses to give an example of how the new margin structure will work, but stresses there will be remuneration for Saab Unlimited dealers. General Motors' decision to take greater control of Saab indicates dissatisfaction with the way its subsidiary brand is developing.