Some Ford dealers in Germany face bankruptcy

Automaker more willing to have multi-brand showrooms

Ford insiders say that at least six large Ford dealers in Germany are at risk of collapsing.

The at-risk dealers are located in the areas of Wuerzburg, in central Germany, and Krefeld, about 19 miles (30km) northwest of Dusseldorf.

Last year, 28 of the automaker's dealers in Germany went bankrupt, including large groups such as Ford Heister in Trier, about 115 miles (185km) southwest of Frankfurt.

"We want to refill these gaps as quickly as possible," said Reinhard Zillessen, Ford sales and marketing chief. "There are applicants for more than 20 of them."

The atmosphere is tense. One dealer complained: "Ford-Werke boss Bernhard Mattes drives dealers into insolvency by offering special premiums to push cars on the market."

Statistics from the The German Association of Motor Vehicle Importers (VDIK) show that Ford pushed day registrations at the end of March, increasing its market share to 7.4 percent.

A new-car is considered a day registration when a dealer registers it to the company for at least a day and then sells it as a used car for a discount of up to 5,000 euros. The car shows up as a new-car registration, which helps the dealers because the business usually gets a bonus based on volume.

Ford also has encouraged dealers to increase the number of cars they order from the factory by increasing the dealer discount, and by offering a 400 euro bonus for every car ordered beyond the quarterly number of cars agreed upon, the dealer said.

"Now all the storage yards are filled with cars," another dealer said, and April sales "will be depressing."

Rivals become allies

Ford's troubles have made it much more willing to open multibrand dealerships, even with a bitter rival such as General Motors' German subsidiary Opel.

A former Ford-only dealership in Mainz, southwest of Frankfurt, has been reborn as a sales outlet for Ford and Opel.

Joerg Enderlein and Shariar Pirzadeh of Delta Automobile invested 4 million euros in the location.

Seven Ford dealers in Germany also sell Opels, including Delta Automobile's location, six of those businesses sell the cars under the same roof.

All together Ford has 61 dealers that offer other brands that are not part of either Ford or its luxury division Premier Automotive Group.

In Mainz, the rival brands' sales staffs work independently. Only a cafeteria separates the carmakers' showrooms.

Ford's head office in Cologne has no reservations about its cars being sold in the same dealerships as Opels. "It is not a problem if they take other brands into their portfolio," Ford's Zillessen said, "as long as our dealers have the Ford brand under control."

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