Citroen has informed the franchisees in its 182-strong dealer network that half of the sites will not continue to represent the DS Automobiles premium-sub brand from 2018.
The news was officially confirmed individually to franchisees this summer, after AM revealed last November that only around half of Citroen/DS dealerships would continue with the split-off DS business.
The official notice coincided with a period when the average profitability of the network has slumped from 1.2% to 0.5% after a lack of focus on retail sales.
Citroen and DS Automobiles managing director Bek Hassan told AM the brand knew franchisees had concerns but he hadn’t expected Citroen to come bottom for franchise value in the latest NFDA Dealer Attitude Survey.
“Clearly the NFDA results were disappointing. We’re not oblivious to the fact our dealers are saying they’re unhappy,there’s a problem, and the only thing we can do with that is react and work with them to resolve their problems,” he said.
“I guess the separation of the two brands inevitably has caused some hesitation with our dealers, because separation of brands happens almost once in a lifetime, and this is something new for our dealers.”
The dealers who’ll lose DS were selected due to the lack of sales opportunity for the premium brand, with criteria based on local demographics and past DS sales performances.
He said Citroen franchisees have since seen the product pipeline, with increased volume expected from new C3, and other unspecified models further ahead (a C-segment crossover SUV is an obvious fit), and are more upbeat now.
“We have these short term challenges, yes, but ultimately we’ll fix those challenges with our dealers, we’ll do it together.”
“We can’t be oblivious to the impact of going through this transition, and it’s really important to our dealer partners that we work with them, because they’re the backbone of what we do.”
After the NFDA survey Citroen spoke with its dealer council and dealer forums.
Hassan recognised the split has caused “hesitancy and concern over the future”, and he and Citroen global chief executive Linda Jackson have tried to reassure the UK network.
- For more about the Citroen and DS plan, read AM magazine in December.
An award-winning journalist and editor, with two decades of experience covering the motor retail industry, and accredited by the Institute of Leadership and Management (ILM) plus the National Council for the Training of Journalist (NCTJ)
As editor of AM since 2016, Tim is responsible for its media content, planning and production across AM's multiple channels, including the website, digital reports, webinars, social media and the editorial content of AM's events, Automotive Management Live and the AM Awards. His focus is on interviewing senior leaders of franchised dealer groups and motor manufacturer national sales companies to examine latest developments in UK motor retail.
stephen troup - 03/11/2016 15:13
A stupid direction for this undesired brand to pursue. In time they will come to realise that this deluded strategy is counter productive to their shareholder objectives. They should stick to supporting the 'good ol Ma and Pa' dealers who are unable to represent a more successful manufacturer.