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Soul-searching time after MG Rover demise

The collapse of MG Rover hit Souls Motor Group, an independent two-site dealer, hard. Now, as one of the first approved franchised dealers for the brand’s relaunch, managing director Andrew Soul is waiting with baited breath. Demonstrators were due in February, but have been postponed.

“There are a lot of people that want the brand to come back,” said Soul. “And it has been intimated that it will be more cheaply priced.”

In the meantime, Soul has taken on new franchises at his Buckinghamshire sites: Subaru at the original Olney branch and Fiat and Proton at the Bletchley site, which opened in 2004.

“The demise of MG Rover has meant we’ve had to change the way we dealt with people – and broaden our client base,” said Soul. “We rely on our service customers as most of our profit is in aftersales.”

Customer databases for the new franchises had to be built from scratch. Soul admits Subaru’s first year at the site has been “difficult”. He has chosen the lowest target – 75 units – allowed by Subaru for 2008, as he believes runout of models like the Legacy and Outback will hinder sales.

“The UK market has gone towards diesel – the launch of the Impreza diesel engine will have a huge impact on sales, I think,” he said.

The Fiat business is picking up rapidly. In 2007, Souls sold 170 units, and this year it expects to sell 250.

“Fiat dealers in the surrounding areas of Bedford and Luton have closed, which has helped us,” said Soul.

“There has been phenomenal interest in Fiat 500 – none like I’ve ever seen before. It will have a halo effect on the whole range.”

Proton sales are expected to remain stagnant around 50 units. Soul blamed this on a lack of brand awareness.

“People need to know the product exists. When Proton did a TV campaign, a lot of people came and looked,” he said. “Now that has stopped, people have stopped looking.”

Milton Keynes is a competitive area – with the big players represented. “The PLCs have huge amounts of money to throw away on advertising,” said Soul.

“It looks like a lot of cars are being registered in Milton Keynes, but it’s disproportionate because a number of car manufacturers’ headquarters are here too.”

Soul believes the value of local newspaper advertising is falling due to the internet. He is finding new ways of attracting customers.

One way is Google’s pay-per-click advertising. Soul thinks it “is the sort of thing that seems to be the way forward”. It means an ad is displayed besides related search results and you only pay when someone clicks on it.

“We’ve signed up for six months. We need people to get talking to us on the telephone and hopefully this will help,” he said.

The family run business, which started on its current Olney site in 1907 as a bike and pram retailer, has had a £6m turnover for the past two years, compared to £8m in 2004. But Soul is optimistic and expects a rise to £6.5m turnover this year.

While there are no plans to expand, Soul is interested in an Alfa Romeo franchise above anything else.

But he is more concerned with the task at hand: “Fiat is on the up and I think we should focus on that at our Bletchley site.

“Just as manufacturers should support us, we as dealers need to show a bit of loyalty and stick with them through the tough times. It’s all cyclical anyway. I say that, but I haven’t seen that happen to BMW yet!”

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