1:26 pm, August 25, 2022
MG is planning to slash its dealer network as it seeks to expand its brand with larger, more metropolitan partners.
Car Dealer has heard from a number of MG dealers who have confirmed rumours that the Chinese-owned British brand put dealers on notice earlier this year and is already wielding the axe.
MG has yet to confirm new contracts with its network, but smaller, more rural dealers that have been with MG since its rebirth under Chinese management are in the firing line, sources suggest.
Car Dealer has approached MG Motor UK for comment.
One dealer, who wanted to remain anonymous, said it was ‘a sign of the times’ and some dealers were already closing their doors.
‘The MG franchise has been a mess for a long time,’ the dealer told Car Dealer. ‘When SAIC first bought MG, they were desperate for any dealer to take a franchise to sell the TF sports car – MG would take anyone.
‘Now, with the company selling over 30,000 cars last year, they want to get rid of the smaller, rural dealers who are in odd places and who aren’t selling in quite such high numbers.’
Car Dealer believes around 15 dealers have already lost their franchises with potentially more to follow.
Another dealer who spoke to Car Dealer confirmed the rumour that smaller dealers were destined for the chop, particularly those partners that had been with the brand for a decade and previously may have been Chevrolet or even MG Rover dealers in the early 2000s.
They said: ‘MG wants larger dealers who have the capacity to offer an eight-car showroom as many new models are on the way’, adding: ‘The big dealer groups are coming in now and MG wants to talk to them instead.’
Arnold Clark, the UK’s largest car dealer, opened two MG showrooms in June, taking its representation of the British brand to seven sites.
MG’s network now stands at 153 locations and has sold 16,000 cars so far in 2022, taking its market share to a healthy three per cent.
The rumours come as MG launches its new MG4 to the press this week.
One dealer group told Car Dealer the brand has been a ‘huge success’ for its company, delivering sales that have beaten expectations ‘threefold’.
It said: ‘The news shouldn’t be a surprise to the dealers who haven’t been selling many cars.’
The dealer added: ‘By 2024, the MG4 that’s launching this week will be the oldest model in MG’s line-up – they’re not hanging around!’
Since publishing this story, a now-former MG dealer who lost their franchise claimed the company has been ‘very underhand’ with its network.
‘They’ve been ruthless and it’s been a very upsetting experience,’ it told Car Dealer.
‘We’re a family business and came on board in 2012. You have to remember back then the only product we could sell was the MG6.
‘Things started to improve in 2017 with the launch of the ZS and sales really got going in 2019 with the ZS EV.
‘We had a fantastic local reputation with many loyal and happy customers and then the franchise was taken away from us.’
The dealer added: ‘Many of the dealers facing termination are the small, family-run ones which have many loyal customers and have been with MG and MG Rover prior to that for decades.
‘The company is in complete disarray and it’s impossible to get sense from anyone in management.’
