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MG Rover's German dealers plan 'clearance sale'

Neuss, Germany. MG Rover dealers in Germany have formed a committee to work on plans for selling off vehicle stockpiles and to decide on the payments of claims against the collapsed carmaker.

The creditor committee is expected to come up a "clearance sale" to market MG Rover inventories by the end of the month. A total of 1,150 MG Rover vehicles are stockpiled in German dealerships. The committee will work with MG Rover administrators PricewaterhouseCoopers.

The committee was created at a meeting for MG Rover creditors on June 16. One of its tasks is to figure out how much money dealers will receive from their outstanding claims against MG Rover.

Said Lothar Schnabel, spokesman for the MG Rover dealer association: "It is especially important to us that we put a monetary figure on our claims against the importer."

Dealers and the administrators have still not reached an agreement on how high the discounts should be for the vehicles that will be sold off. Schnabel said a suggested figure of 30 percent is too little.

The dealers association is checking to see whether a secondary insolvency for MG Rover Deutschland GmbH could accelerate claims payments.

Juergen Voss, MG Rover Deutschland's managing director, said the priority is "the productive marketing of our assets through dealers" and an "orderly retreat." Inventories should be sold exclusively through the MG Rover dealer network, and not through independents, he said.

Cars would get a new-car warranty through the ADAC subsidiary Real Garant. It is still uncertain whether the warranties will apply to vehicles already delivered.

Voss said in those cases cost-sharing by dealers and customers is a possibility.

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