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Renault to cut dealer network by a third in 2012

Renault will reduce its dealer network in the UK by a third next year and will also be cutting the Laguna, Modus, Wind, Espace and Kangoo car from its model range here from February 1.

The 190 dealer network will go down to "around" 135. Some of the closures will be within the Renault Retail Group but Renault was unable to quote an exact figure as discussions are ongoing.

The move is aimed at returning the French carmaker's UK operations to profitability as AM understands 50% of the dealer network has been running at a loss.

Managing director Thierry Sybord said that dealers were given the news at the end of last week and while reaction has been mixed, it is mostly positive.

Sybord: "There is a general feeling that something needed to be done.”

Termination letters are being sent by the end of December, giving dealers 12-months legal notice of the network reorganisation.

Renault UK said it would be taking a number of measures to improve brand perception and residual values.

Central to this will be the introduction of a ‘4+' incentive - four years/100,000 miles warranty, four years/48,000 miles free servicing on cars and four years/80,000 free servicing for vans, four years roadside assistance and a four-year finance package.

No to unprofitable fleet deals

The company is also pulling out of unprofitable fleet business for the time being, including cutting its Motability supply by some 90% and slashing rental, but will continue to serve its core fleet customers.

Sybord revealed 2012 will be a "transition" year with the gradual introduction of its zero emissions models, culminating in the Zoe at the end of the year. Also arriving at around the same time will be the fourth generation Clio, historically a successful car for Renault in the UK, and the launch of the Dacia brand.

All Renault dealers will sell the Dacia Duster and new generation Sandero models when they arrive around November.

The investment required for Dacia is minimal - around £3,000 for signage and tooling - as it will occupy "a corner of the showroom", said Sybord.

Dacia, with the Duster priced below £10,000 and Sandero below £7,000, will be a "no haggle" retail-focused brand.

Sybord added: "During 2012 we plan to move the Renault brand up in terms of customer perception and bring in Dacia below it. Our electric vehicles, or Z.E. brand, will form a halo above."

Z.E. models will be the Kangoo Van, Twizy, Fluence and Zoe. Asked if the large models, next generation Laguna and Espace, will eventually be reintroduced, Sybord said: "We will have to wait and see.

"It is difficult to compete in the D segment against Ford and Vauxhall so a Laguna in the future will have to offer something very different. I think that we can expect something very different with the next generation Espace and that will be worth looking at."

To see the full story on Renault's plans for 2012 and beyond see AM's January issue.

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  • Irishboy4 - 21/12/2011 05:12

    A sign of decisive leadership, well done Thierry Sybord and Renault. Sad although that some jobs will be lost.

  • Visionary - 22/12/2011 10:15

    Frankly I’m shocked at Thierry Sybord comment: "There is a general feeling that something needed to be done.”. I’m sure as the manufacturer they would have had access to P&L details of the current dealer network. I’m surprised if Renault would react to a “General Feeling” or am I being cynical and Mr Sybord has not given the real facts as to why this decision has been made. It looks as if in 2012 the Renault brand revival will be a product led to raise the brand profile, perception & value. This will take strong leadership from the senior management at Renault and the dealers. Working with “general feelings” let’s see if by September 2012 the tailgates and balloons are still up to attract the customers? ;-)