Autowelt AG wants to become a trading empire

Ettlingen. Autowelt AG, one of Germany's largest car dealers, is planning to use the reorganization of Europe's dealer network to dramatically boost its growth.

Autowelt is currently looking for franchise partners across Germany. The plan is to increase the number of sales locations to 150 and to sell roughly 34,000 cars a year by 2007.

Autowelt's potential partners are dealers who had their contracts with car manufacturers terminated following the new block exemption rules and who are looking at becoming multi-brand franchisees.

Autowelt has 14 locations in southern Germany. In 2003 it expects to sell about 2,000 cars from several different brands and achieve a turnover of around 18 million euros.

Future partners will pay operating costs of 2 percent of the net purchase price plus a monthly fixed sum of 1,250 euros. Also, the modification of each showroom will cost between 10,000 and 15,000 euros.

Dealers will then profit from Autowelt's Europe-wide purchasing network.

So far Autowelt has mainly sold re-imports, half of which came from EU countries and half from other European countries.

Should European car prices continue to be adjusted -- and marketing director Matthias Gaertner says he assumes this will be the case -- selling re-imports will become less profitable. So Autowelt is purchasing 30 percent of its new cars directly from the original equipment manufacturers or via middlemen.

Gaertner says the goal is to create a nationwide network in Germany and to increase its purchasing power through bundling the purchasing volume.

"Then car manufacturers will roll out the red carpet for us," says Gaertner.