FRANKFURT - After cutting the number of Volkswagen and Audi outlets in Europe from 8,300 to 7,800 since 1996, Volkswagen AG says the total will remain stable for a few years.
At Volkswagen's insistence, the remaining dealers are investing an average of 1 million marks ($550,000) to refurbish their stores.
Some will spend much more. Autohaus Lang, a large Volkswagen and Audi center in Stuttgart will invest $22 million.
Altogether, dealers will invest $2.75 billion, said Robert Buechel-hofer, Volkswagen management board member in charge of sales.
'A wave of investment has begun,' said Buechelhofer. 'We want to improve our service and what we offer to our customers.'
The restructuring, known as 'Idealnetzplan 2000,' is aimed at separating Volkswagen and Audi brands, cutting sales points and raising dealer profitability.
The average Volkswagen/Audi dealer now sells 300 to 400 cars per year, and the average profit margin is 1.5 percent.
Volkswagen wants average sales of 500 cars by 2000 and margins of 3 percent or more within five years.