HYUNDAI has changed a staggering 64 per cent of its dealer network in the last four years as its sales have ballooned and many have struggled to keep up.
Hyundai UK president and CEO Tony Whitehorn told Car Dealer the changes have come about after the manufacturer asked its dealers to invest big in their ambitious sales plans.
He said: ‘We’ve said to dealers, look at what’s coming, we’re going to go from 28,000 sales to circa 100,000 sales and this year we’ll do 80-85,000. So they need bigger facilities and they need to invest more. The prize is more throughput but they need to invest.
‘Back in 2008 we were 23rd in the marketplace, this year we’ll be 10th. That’s a massive move and that says to the dealer network you’ve got to change. Over the last four years we’ve changed 64 per cent of our dealers.’
While some of the manufacturer’s network put their hands in their pockets and shelled out on new facilities, many decided not to.
Whitehorn added: ‘Some dealers have said that investment is fine – those like Richmond Hyundai have put big investment in Portsmouth, Southampton and have just built a big facility in Guildford. But lots of other dealers have said they don’t want to invest, say £2m, and we’ve said that’s not a problem and have worked out an exit strategy for them.’
That has lead to the big changes in the Hyundai network. The manufacturer has grown from 130 dealers in 2011 to 160 today – and it’s looking to increase this to around 175 in the future.
Whitehorn also believes servicing presents the biggest opportunity for his dealers to make money at the moment.
He told Car Dealer: ‘We have grown steadily over the last few years in terms of sales. Therefore sales have gone up and the vehicle parc has grown too so the biggest challenge now is servicing capacity. The dealers that have invested here are full to capacity. That’s our biggest opportunity and our biggest challenge, but the biggest area where dealers can make some serious money.’