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Peugeot to cut dealer network after review

Peugeot is to reduce its franchised dealer network from 295 outlets to “between 260-270” after completing a comprehensive review of its national sales structure.

Dealers being dropped by the franchise have been told verbally and will receive official confirmation by letter before the end of this month.

They include single sites and some outlets owned by larger groups.

Although Peugeot’s seven-year fixed sales contracts require the carmaker to give a one-year notice of termination, it is giving dealers two years’ grace, which takes the company up to the next Block Exemption Regulations in 2010.

Peugeot also has a number of dealers on two-year rolling contracts, also with two-year notices of termination.

Under BER 2002, manufacturers issuing fixed contracts had to give a minimum term of five years; therefore, since May 2005, Peugeot switched to rolling contracts to ensure all contracts ended in time for BER 2010.

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