MG-Rover Sales Philosophy

[tony barnhill]

I receive from MG-Rover almost on a daily basis all their worldwide press releases...while the latest won't affect us in North America, it is an indication if MG-Rover's philosophy...&, its a new idea: preowned cars sold by factory retaining remaining factory warranty!

RELEASE IMMEDIATE
August 13, 2003


MG ROVER DIRECT LAUNCH WEEKEND 16TH-17TH AUGUST!

MG Rover Group are now selling pre-owned cars direct from the Longbridge site, under a new initiative titled 'MG Rover Direct', with the MG Rover Direct Sales team located at the Longbridge factory.

New cars displayed in the Visitors Centre are now joined by a display of 70 used cars. Behind the scenes around 400 cars are prepared and ready for sale, making this MG Rover's first used car supersite.

Over the weekend 16/17 August, special launch offers will be available to all purchasers of cars from MG Rover Direct. Potential customers can benefit from factory priced cars, but over the weekend can take the benefit of 2-years' 0% finance with zero deposit - a first for a used-car purchase.

In addition to the great finance offer there will be the opportunity to enter a free prize draw to win match tickets to any of the three local premiership clubs. Whilst viewing the wide range of nearly new & used MG Rover cars, customers will be provided with free refreshments.


By visiting MG Rover Direct at Longbridge this weekend, you will be supported by a host of other standard features:
* Over 400 nearly new & used MG & Rover models direct from the factory
* The largest choice of used MG and Rovers anywhere in the UK with the widest range of models, colours and specifications from the ex-company management scheme, demonstration, ex-finance, press & show cars.
* Part exchanges are welcome
* 12 months warranty or balance of manufacturer's warranty (whichever is greater)
* 12 months roadside assistance
* 30-day exchange plan
* Vehicle history and mileage check
* Tailored finance options
* One-to-one customer service

The complete range of used cars available through MG Rover Direct can be viewed at https://www.mg-rover-direct.com, or you can contact the sales team on 08701 121 999 or simply visit MG Rover Direct at Q Gate, the Visitors Centre, Lowhill Lane, Longbridge, Birmingham, B31 2TB.

 

[Steve]

Interesting concept.....I don't know if it could ever catch on over here though. The dealers would be up in arms! In the UK, car salespeople do not have to be licensed either, so there are fewer obstructions to setting up that sort of operation in the UK.

 

[Joe Reed]

I don't see what's so new about the warranty. Aren't most new car warranties still transferable to a new owner? I know they used to be...
As for the vehicle historys, 12-month warranty, etc., that's been done for years by various dealers - especially those run by the big rental fleets.
And yes, the dealer would never allow the manufacturers to do this in the US. Remember when just about all the rental car companies (Budget, National, etc.) had outlets to sell the cars coming out of their rental fleet? The dealers put pressure on the manufacturers to quash that - it took too much business away from their used car departments. Even those with sales outlets (like Budget) now buy their cars at auction just like the dealers.
The only exception I'm aware of is Enterprise. They still exclusively sell cars from their fleet. I don't know how they worked this out, but I do know that they are required by the manufacturers to keep the cars in fleet for a certain number of miles before selling it...

 

[aerog]

Mazda is doing that with Miatas (Roadsters, MX5s, whatever) in certain markets - not in the USA. There's a lot of details of course, but essentially they're taking used cars, remanufacturing them, and selling them as remanufactured cars.

 

[tony barnhill]

When I was in the Middle East for Desert Storm, I ran into Mercedes & BMW factory reps..they were buying up high dollar used cars, loading them in trucks bound for the ports where they were shjipped to Eurpoe, refurbished & sold through factory outlets...there was this one nice BMW 8-series the BMW rep would've almost given me but it didn't meet our safety criteria - he picked it up for pennies!
Does this mean our dealer system has too much power/control over the factory?

[ 08-14-2003: Message edited by: tony barnhill ]</p>

 

[Steve]

I would say "Yes".

The dealers here hold an enormous amount of sway over the factories, as here they are "franchisees", paying a substantial fee to the factory for the privilege of selling their cars. I am not sure of the arrangement for the UK, but it is not quite the same. They are not allowed to hold multiple dealerships at the same location, unlike in the USA.

 

[Joe Reed]

I wonder about that "remanufacturing" idea since that's basically the same as "restoring" - and we all know just how cost effective "restoring" a car is! I imagine they do an inspection and fix anything that appears to need attention, but that's a long way from "remanufacturing" a car. Of course, I'm sure only the top quality used cars are selected for this kind of program. Otherwise the factory would lose money. They could sell a new car for less than it would cost to actually "remanufacture" a used one...

 

[William]

This sounds vaguely similar to Nissan's program of buying and restoring 240Zs and selling them thru a few select dealerships. Granted, a cherry 240Z is in a completely different league to a "used" car, be it a BMW 8 series or an MGF
-William

 

[PC]

<blockquote><font size="1" face="Verdana, Arial">quote:</font><hr>Originally posted by Joe Reed:
I wonder about that "remanufacturing" idea since that's basically the same as "restoring" - and we all know just how cost effective "restoring" a car is! ...<hr></blockquote>

It depends on how they go about it. Restoring is taking a vehicle individually, evaluating its condition and reworking as needed one on one. It’s a craft, almost an artform because there is so much room for interpretation and variation. Manufacturing is a systematic volume operation (well it’s supposed to be anyway) making the same product over and over from raw materials. When remanufacturing a product the company will typically strip them all down to some basic level and then build them up again using consistent procedures and new components. Economies of scale and streamlined processes make it far more cost effective than restoration.

The conceptual difference may be subtle but the outcome is usually dramatically different. More often than not a remanufactured system is as good or better than the original and less costly than a new product. As an example the B-52’s that were making all that noise way over there recently have been in service since the early 60’s. Today, their capability is far and away superior to what it was when they rolled off the assembly line.


PC.