Priory Motor Group has become one of the first UK retailers to exploit revised block exemption regulations by opening a multi-franchised showroom in the north-east.

The Gateshead-based outlet will accommodate Kia and Daewoo new car franchises and sits on the site of Priory's former Toyota dealership. The group lost that franchise as part of the carmaker's network revisions, but will remain an approved Toyota service/repair business. This means the workshop will become an app-roved repairer for all three marques.

“Kia and Daewoo are up-and-coming brands which have real potential,” says Priory Motor Group general manager Tom McVinnie. “They have rapidly established a name for offering affordable quality.”

The showroom, which accommodates around 18 cars, will be open plan allowing customers to walk freely between the two clearly branded sales areas, but will have separate Daewoo/Kia entrances with full signage.

Each brand will have dedicated sales staff – there will no crossover, unlike in the workshop where technicians will be trained to repair all three marques. “Kia and Daewoo are compatible franchises attracting similar clientele,” says a spokesman for Priory Motor Group. “Neither currently justifies a standalone showroom, but the volumes mean they fit perfectly into this facility.”

The decision goes against the perceived wisdom of some analysts who believe the only way multi-franchised outlets can work is if they hold non-competing marques. But Priory is convinced its approach is the way forward. It's also considering a similar move in Manchester where it recently acquired the Daewoo franchise.

The Manchester business is currently operating out of temporary facilities, but Priory has the option of setting up a standalone dealership or putting Daewoo in with one of its adjacent Ford, Fiat or Nissan showrooms. The decision rests on the amount of business the Daewoo franchise attracts.

“Sharing showrooms means we save on the cost of investing in separate facilities. It's good for us and it's good for the customer as they can look at several cars in the same location,” says the spokesman.

Priory Motor Group is part of the Co-operative Group and has 16 franchises in 28 dealerships.