PARIS - Renault and Nissan will consolidate their combined 3,000 dealer territories in Europe into 800 greatly expanded market areas by the end of the decade.
Service, parts, and finance will be merged in the market areas -called hubs - but Nissan and Renault showrooms will be kept separate. The hubs will be managed by a single main dealer.
The main dealers will be chosen from both Renault's and Nissan's current dealer networks, although most will come from Renault. For example, no more than 20 out of 165 Nissan dealers in France are expected to remain independent.
About half the hubs will be operating in 2005.
Starting in July, the structure will be implemented in France, Germany, Italy, the Netherlands, Spain, Switzerland, and the UK. The program will set up a network of dealers who sell both brands, although separate outlets will be kept.
The plans were unveiled here last week by François Hinfray and Norio Matsumura, respectively Renault executive vice president for sales, and Nissan executive vice president for overseas operations.
The two partners are targeting a combined European market share of 17 percent in 2005: 12 percent for Renault (compared to last year's 11.3) and 5 percent for Nissan (instead of 2.9 last year).
'We expect savings and benefits of A690 million over five years, plus extra sales of A310 million thanks to a limited cross-badging policy,' said Hinfray (see story on Page 21).
The biggest surprise in the reorganization - which has been expected since Renault bought a controlling stake in Nissan last year - is the drastic reduction in the number of dealerships into hubs, where such operations as parts, logistics, information technology systems, administration and finance can be combined.
'We hope to have between 600 and 800 hubs in the long term, but 800 seems more realistic,' said Philippe Geffroy, Renault manager in charge of the Renault/Nissan cross-company team for Europe. Around 100 hubs are planned in France, 100 in Italy, fewer in the UK and more in Germany. By 2002 the hubs could account for 75 percent of Renault sales and two-thirds of Nissan sales. Average annual sales are targeted at 2,200 new cars for Renault dealers, compared to 1,020 in1999, and 670 vehicles for Nissan, instead of 240 last year.
About 460 hubs should be effective in 2005, rising to 800 by the end of the decade.
France will see the greatest number of Nissan dealers losing their independence, said Martine Ribot, president of Nissan's French dealer association. The situation should be different in UK and Spain, where Nissan has a bigger market share.
The sales and marketing organizations will also be reconfigured. Back-office functions will become common in the seven main countries. That includes non brand-related activities like marketing procedures, parts and accessories, fleet, finance and accounting, legal affairs, and human resources.
In Germany, the Netherlands and Switzerland, Renault will take over all sales and marketing operations for the two brands. In France, Italy, Spain and UK, each brand will manage sales and marketing separately.
Nissan Europe will keep its Amsterdam headquarters but will move its marketing services, led by ex-Renault Germany boss Mario Canavesi, from Amsterdam to the Paris area. They will likely be located in Nissan France's offices in Trappes, in early 2001. The move involves about 120 people, out of a total 310 employees in Amsterdam, where 44 jobs will be cut.
Altogether, Nissan will lose 55 percent of its European sales and marketing workforce by 2003. That will leave 600 people out of the 1,477 it has today.
Renault will add about 300 employees to the 4,121 sales and marketing positions it has today. A Nissan spokesman said jobs with Renault operations will be offered to Nissan employees.