Chevrolet will cease to exist as a retail brand in the UK by the end of 2015, General Motors has announced.
In a conference call today GM vice chairman Steve Girsky said it will end its presence in Europe due to a challenging business model and the economic difficulties in the continent. GM will focus on the Opel and Vauxhall brands- and select iconic vehicles, such as the Corvette – in western and eastern Europe.
Chevrolet UK heard of the decision at 5am today. It has been in touch with its franchised board and the dealer network in the hours since and, a spokesman, said begin to discuss the options more of which will be known about in the next month or into January.
"Our commitment is to meet our contractural obligations to the end of 2015. We will discuss on a case-by-case basis what our dealers want to do," he said. ""The immediate priority is to help them sell cars and support customers." Authorised repairers, he said, will probably be given the opportunity to continue.
AM understands stock levels are low meaning there is little likelihood of 'fire sales'.
"We believe this is a win for all of our brands here in Europe and around the globe as GM will benefit from a stronger Opel/Vauxhall," Girsky said.
Pulling Chevrolet from Europe "will help us to accelerate progress in the region," he said.
"Unacceptable” financial performance at the brand in the region contributed to the pullout, Girsky said.
“Europe is a key region for GM that will benefit from a stronger Opel and Vauxhall and further emphasis on Cadillac,” said GM chairman and CEO Dan Akerson. “For Chevrolet, it will allow us to focus our investments where the opportunity for growth is greatest.”
“This is a win for all four brands. It’s especially positive for car buyers throughout Europe, who will be able to purchase vehicles from well-defined, vibrant GM brands.”
Cadillac will enhance and expand its distribution network over the next three years as it prepares for numerous product introductions.
Thomas Sedran, president and managing director of Chevrolet Europe, said: "Our customers can rest assured that we will continue to provide warranty, parts and services for their Chevrolet vehicles, and for vehicles purchased between now and the end of 2015.”
In the UK Chevrolet sales peaked at 18,660 in 2009 (when it achieved its best market share of 0.94%), but since then have declined year-on-year. 2012 sales were 13,476 (0.66% share).
To November this year they were 11,281 units and a market share of 0.53%.
The number of franchised outlets is currently 72. At its peak in 2007 it had 96. 70% of the network are co-branded with Vauxhall. typically by the larger dealer groups.
AM100 groups such as Marshall, Pentagon, Peter Vardy, Vertu and Caffyns ceased representing the brand since 2012.
In September Sedran acknowledged Chevrolet's problems in a highly competitive market: "We need to appeal more to younger customers to help differentiate our cars from Opel.
"The fact is we are not among the top five when people are choosing a car. We will concentrate on our brand values which are expressive design, value for money and a good price. We will push the fact that Chevrolet enables people to stay connected and that's very important for young buyers."
Business analyst Jay Nagley, manging director of Redspy, told AM: "At present people can go into a dealer for a Chevrolet and be sidetracked by a great deal on the equivalent Vauxhall.
"The question remains open as to whether the Corvette is a halo car or a counter-productive distraction."
GM’s losses in Europe since 1999 have exceeded $18 billion, including a $214 million deficit in Q3. The carmaker began selling Chevrolet models in Europe in 2005, re-badging low-cost vehicles made by its Daewoo division in South Korea, and it came close to selling Ruesselsheim in Germany to Canadian car-parts maker Magna International in 2009 as it worked towards becoming solvent.
A spokesman for Chevrolet says the decision does not threaten its long-term sponsorship deals with Liverpool and Manchester United and that the partnerships will be exploited to grow awareness of the brand globally. The marque starts a seven-year shirt sponsorship of United from the 2014/15 season and signed a four-year 'official partner' deal with Liverpool last July.