LONDON - Ford in the United Kingdom is choosing its best dealers to buy out their neighbors and create bigger sales territories. The consolidation will enhance Ford's image and increase dealer profits in Europe.
In the United Kingdom, Ford has selected 110 dealers to act as partners and buy out 180 other Ford dealers. They will cover the entire country as Ford retailers.
Bill Cross, manager of market representation at Ford, said that by the end of this year, about 70 percent of Ford's total sales in the United Kingdom will come from those 110 partners. The total number of United Kingdom dealers has dropped from 380 in 1996 to 290 today.
'The key message is to keep the customers happy and take out expensive layers of management,' said Cross.
Ford wants fewer dealers operating the same number of locations within larger market areas throughout Europe. The goals are to eliminate competition among neighboring Ford dealers and give Ford a consistent message in each region. Dealer profitability should increase.
The concept will work about the same everywhere. Timing and numbers will vary according to each country's needs. In France, for example, the total number of dealers will be cut by more than a third from the current 303.
Kenneth Joergensen, sales operations manager for Ford Denmark, said Ford is looking at similar strategies in the smaller European countries, but the company will not act as quickly as in the United Kingdom. Reduction in the smaller countries will probably come by attrition rather than buyouts of other dealers.
In the United Kingdom, Ford selected its partners based mainly on sales, customer service, assets and commitment.
Half of the dealers not chosen as partners have agreed to negotiate buyouts, but no dealers will be forced out, said Tom Inglis, owner of Strath Ford in Dumbarton, Scotland, and chairman of the Ford Dealer Council in the United Kingdom.