Seat is ready to trim its dealer partners still further while preparing for the change in European block exemption regulations this October.
Seat will have cut the number of dealers it has across Europe from 2,000 three years ago to 1,300 by October. Pedro Catena, the Spanish carmaker's export market director, believes the network could be reduced even further to 1,000 dealers over the next year or two.
"This does not necessarily mean we are reducing the number of outlets, just the direct number of partners we deal with," Catena said at the Barcelona auto show. "Those partners may operate a number of satellite sales and service operations."
He added that Seat's unique position in Europe has allowed it to lead the way among automakers in preparing for the change in block exemption rules. With a production capacity of just 500,000 units, Seat can sell all the cars it makes.
"We canceled all our dealer contracts in Germany two years ago and reduced our partners by 50 percent. Everyone thought we were crazy," Catena said. "But we saw what was coming, the next revolution after the platform policies if you like. Some 85 percent of our production is sold in Europe and that puts us in a strong position."
He added: "We took a very pragmatic approach and went to our dealers with a sound business proposition. As a result, the average sales per outlet in Germany has risen from 155 cars a year to 270 - that's good business for them."
Even so, Catena does not think that Seat is properly represented in all Europe's major cities yet.
"That is something we are looking at," he said, "but we have to make sure we have the right dealers - and if we cannot find them we will operate the dealerships ourselves in those places."
Seat is taking direct control of distribution in Portugal following a disagreement with importer Sociedade Hispanica de Automoveis over warranties. Catena said Seat did not intend to take over any other distributors in Europe at present.
Seat already distributes directly in Spain, the UK, Germany, Italy and France, but has importers in other European markets.
"If they are doing a good job why should we want to take the contract away from them?" Catena asked.
With limited capacity, Catena added that Seat was not looking to significantly increase sales beyond Europe.
He said: "South America and some Arab countries are logical markets for us where the brand is known and does well, but we are not currently looking beyond that with the Seat brand."