McCarthy Limited’s R72-million investment in two multi-brand dealership complexes in Durban and Maritzburg will provide customers with “a one-stop shopping destination”.
McCarthy Limited’s R72-million investment in two multi-brand dealership complexes in Durban and Maritzburg will provide customers with “a one-stop shopping destination”, the group’s chief executive, Brand Pretorius, said this week.
The move is partly in response to DaimlerChrysler bringing its dealerships in-house with its controversial new dealership network strategy, analysts say.
"Motor dealership complexes offer very functional benefits," Pretorius was quoted as saying by . "From the customer’s point of view, it is like a permanent motor show displaying many prominent brands at a single destination, where parts and service are also provided.
"The complexes will also enhance McCarthy’s visibility and create a strong McCarthy identity, while maintaining the separate identity of the various dealerships," he added.
Pretorius pointed out that the trend towards one-stop motor dealerships was being driven mainly in the US, as property prices in Europe were "astronomical".
"In the US, fast fitment and battery centres have also been added to the basket of offerings at the complexes, and I see no reason why McCarthy should not move in this direction," he said.
An analyst believes McCarthy’s decision to create dealership complexes had been prompted by DaimlerChrysler’s decision to move many of its dealerships in-house.
While the two KwaZulu-Natal dealership complexes are the only ones to have so far been granted approval by the relevant unicity councils and the McCarthy board, Pretorius said a national roll-out strategy was on the cards as and when leases expired and franchises became available.
At a recent presentation in Johannesburg, Pretorius said there were “too many dealership outlets in the country and motor retailers would have to start cutting back numbers to reduce costs and increase throughput per outlet”.
The Kingsmead site in Stanger Street, Durban, due to open in about six weeks, will include Audi, BMW, Land Rover and Volvo dealerships. Franchises at the recently approved Maritzburg complex, off the N3 opposite Corobrik, will carry the Toyota, Peugeot, Volvo, Land Rover and BMW marques.
Sean McCarthy, the executive director of McCarthy and managing director of Forsdicks, the Durban agent for BMW and Land Rover, said BMW was the only franchise that was "not entirely happy" with the arrangement.
"However, this has been overcome by undertaking to run the BMW dealership as an entirely independent entity," he said. "Land Rover and Volvo, both franchises controlled by Ford Southern Africa, do not have any quibbles and have expressed their appreciation for McCarthy’s R20-million investment in these dealerships on the Kingsmead site."
Pretorius said the complexes were originally to have been branded as McCarthy Motor Cities, but that this had posed legal problems as Motor City was a registered name.