LONDON - Europe is rapidly abandoning the principle of two-tier dealer networks.
More than 4,000 sub-dealers, including large numbers of service-only outlets, were terminated during 1997 - evidence that manufacturers would rather see main dealers operating service satellites within their territories than supplying retail dealers.
The long-expected cull of Europe's over-populated dealer networks is expected to gather pace in the next few years as manufacturers introduce leaner distribution channels.
A new report by UK consultancy Harbour Wade Brown shows the number of new car sales points declined by more than 3,300 across 17 west European countries in 1997.
Philip Wade, author of the report, believes the European dealer population has peaked. 'Some makes have started a rationalization of their dealer networks, but they are only part way through, so further consolidations can be expected in the next few years,' he said.
Indeed, only Cadillac, which added 116 dealers across Europe last year, and the new Smart network that has come on stream since the report was written, are adding franchises at present.