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Tough year ahead for Daewoo network

Daewoo retailers have a tough year ahead as the Korean carmaker struggles to rebuild distribution channels in the UK.

Nick Reilly, GM Daewoo president, warns retailers that until the dealer network in Britain is rebuilt, sales will rise slowly.

The company expects its retail network to grow from 75 to 120 sites by the end of 2004. Former Vauxhall chief Reilly says European sales will climb from 100,000 to 150,000 this year and predicts they will hit 200,000 by 2005. But a significant increase in UK sales will not happen until a new family of diesel engines is introduced in 2005. These are expected to be supplied through sister company Opel.

“One of the major benefits of being part of General Motors is that we do not have to reinvent everything,” says Reilly. Now the company is investing in research and development as well as design, taking on an extra 300 people at its Korean headquarters. Reilly says the four-year plan is to sell one million cars a year worldwide.

GM Europe is developing an inter-group multi-franchising strategy in response to revised block exemption regulations, encouraging Opel, Saab and Daewoo dealers to combine under common ownership in Europe.

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