One of the top performing MG dealerships is pulling out of new car sales, citing the manufacturer’s exponential growth as the principal issue.
Family-owned Summit Garage in Dudley – which celebrates 80 years in business this year – informed its customers this week that it had taken the decision after careful consideration to cease being a MG Motor UK new car sales franchise.
“While our partnership with MG has been positive, we believe that refocusing our efforts will better serve the needs and expectations of our customers,” it said
Summit Garage will now concentrate on selling Approved Used Cars and providing aftersales services, including official MG warranty, servicing and repairs.
The business said that the strategic shift aligned with its core values of integrity, reliability, and customer satisfaction – reflected in the numerous times it had been recognised in MG Motors UK annual awards as an aftersales dealer of the year.
While Summit Garage thanked MG Motor UK for the partnership and support over the years, its co-owner and sales director John Newey explained to AM more of the reasoning that led to the decision.
“The motor trade in general is facing some difficult times at the moment with the decline in the number of customers actually purchasing. I know that MG has in their own words been growing exponentially but the reality is, this year, there has more pressure with less and less retail business.”
He said that because much of the retail business was being driven by Motability and fleet sales, lower margins here had prompted the business to take a strategic look at the sustainability of new car retailing.
“There’s been quite a lot of things that have brought this to head, but from our point of view as a business – we’re third generation as it was my grandmother and grandfather that started the business back in 1945 – we felt that because MG has grown so massively, there has been a lot of pressure on our workshops to be able to deliver the service in time. We felt that being independent would be a better opportunity for us.”
Newey also spoke of the cost associated with financing of new car stock. “Over the last few months, what has been evident is that we had quite a lot of extra finance offered to us through Santander which provides the MG stock financing facility.
“Last November, we had a lot of new MG stock arriving but at the start of this year, the market was just a little bit more depressed. Even so, we had to pay quite large interest amounts on this facility. It was just not sustainable.”
“We looked at that, and also the pressures on our workshops and our service area and we believe we can give a better service to our customers by being independent.”
In term of future retailing strategy, Newey said that Summit is planning to source used cars from brands that it has not previously carried such as Audi, Lexus and Mercedes as well as modern day classics similar to MG.