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Last Updated: Monday, 11 April, 2005, 13:41 GMT 14:41 UK
Rover crisis threatening dealers
MG Rover logos
There are 264 MG Rover dealerships in the UK
As the crisis over the future of MG Rover continues, it is not just the 6,000 jobs at its West Midlands plant which hang in the balance.

Many in Rover's supply and buy chain have been left reeling by its problems, none more so than car dealerships.

While the car maker told its workers to turn up on Monday, and elsewhere its suppliers began announcing redundancies, MG Rover dealerships were bracing themselves for heavy losses.

An end to Rover will have a knock-on effect UK-wide, says the industry.

The government has announced 40m financial help for suppliers, but none for car dealers, who fear they could lose millions.

There are 264 MG Rover car dealerships nationwide and the value of a Rover car is now "very difficult" to know, says Peter Coleman, who owns a MG Rover dealership in Weston-super-Mare, north Somerset.

Business slow

"Business is at a snail's pace at the moment considering where it should be," he said.

"Without question small family businesses that have remained loyal to the product and have accepted the word of the directors as gospel, are going to be very badly hit.

"I should think they could be in severe financial difficulties. There is every chance there will be a lot of redundancies and a lot of insolvencies because of the Rover scenario."

We just need assistance. The worst thing we could do at the moment is panic
Richard Cort

He said it was still unclear who would now be liable for warranties on cars under three years old, which previously had been MG Rover's responsibility.

It is an issue MG Rover's administrators, PricewaterhouseCoopers, are said to be aware of, but it is still early in the process and they have not got to it yet.

Mr Coleman said that while he had taken the decision to "look after their customers" and accept warranties, he said they were not currently accepting those on cars bought elsewhere.

'Need help'

Richard Cort, the chairman of the MG Rover franchise board and owner of three Rover dealerships in Lancashire, said if the manufacturer was dismantled nearly 8,000 jobs would be affected with each dealership facing losses of at least 100,000.

"A number of dealerships will go into receivership if aid isn't given," he said. "We just need assistance. The worst thing we could do at the moment is panic.

"We are staying focused because nothing has been decided and hope things will come clear next week."

David Dyson, financial director of UK car dealership Lookers said dealers would still be invoiced under previous arrangements for unsold Rover cars yet to be delivered.

A separate firm purchases MG Rover's cars and supplies them to showrooms.

Lookers has hundreds of Rover cars left to sell, he said, while some existing MG Rover customers were beginning to cancel their orders.

"As of today, I imagine we are selling no more Rovers," he said.

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