Car dealership restructuring: From performance project to turnaround
The Retail Performance Company (rpc) supports car dealerships and retail groups worldwide through this transformation—with measurable results.
Performance optimization in car dealerships: From efficiency to securing livelihoods
For many years, rpc has been supporting car dealerships and retail groups in Germany, Europe, and worldwide in over a dozen markets. Our focus: measurable performance improvement in the automotive trade. Better sales, more efficient service processes, professional inventory management; in short: higher profits through intelligent customer interactions and optimized business models.
But the reality in automotive retail has fundamentally changed. What used to be performance projects are increasingly turning into restructuring and reorganization mandates. The key question is no longer "How do we achieve the next percentage point of efficiency?", but rather "How do we ensure the survival of our dealership?".
The transformation of the automotive trade: From performance to restructuring
Previously: Performance optimization for success
Traditional optimization projects in car dealerships focused on:
- Increasing conversion in the sales funnel
- Increasing workshop capacity
- Improving telephone availability
- Reducing vehicle downtime
- Optimizing inventory management
These projects aimed to make well-run businesses even better, optimizing a fundamentally sustainable business model.
Today: Restructuring as a strategic necessity
The current reality paints a different picture: car dealerships are often in a solid position operationally, but are structurally in the danger zone. High fixed costs meet volatile demand, rising interest rates weigh on earnings, and capital tied up in inventories is lacking for necessary transformations.
In this situation, simply increasing efficiency is no longer enough. A genuine restructuring agenda is required, a measurable turnaround with a business impact on both the top line and bottom line.
Why car dealerships in Germany and Europe are under pressure
1. Pressure on earnings in the new car business
The transition to electric mobility is tying up massive resources for manufacturers. The result: pressure on profit margins due to aggressive pricing policies, discounts, and volume targets. At the same time, the question of drive systems (combustion engine, hybrid, BEV) is unsettling customers with a direct impact on footfall and sales rates at car dealerships.
2. Structurally high fixed costs
Car dealerships struggle with inflexible costs:
- real estate and manufacturer standards
- Personnel costs
- IT infrastructure
- Investment commitments
Rising interest rates are dramatically exacerbating the situation.Vehicle inventories—especially recent used cars and certain BEV models—tie up capital and simultaneously squeeze margins.
3. Uncertainty due to changes in the sales model
The discussion surrounding the agency model shows that the traditional business model of contract-bound car dealerships is changing. Entrepreneurs are investing "blindly" because the future division of roles between manufacturers and retailers remains unclear. This strategic uncertainty hinders necessary restructuring decisions.
4. Increased competition and regulation
New competitors, especially from China, are challenging established price and product structures. European manufacturers are responding with adjustment programs, the pressure of which is in some cases being passed on to their trading partners.
Restructuring at the car dealership: Consistent performance management, not failure
Restructuring is not a sign of failure, but rather consistent performance management under more challenging conditions — a continuum from optimization to turnaround:
Phase 1: Performance program Create transparency, identify levers, improve results
Phase 2: Strategic restructuring Fundamentally review the business model, brand portfolio, and location structure:
- Which brands are right for our market?
- Which locations should be strengthened, which merged?
- Which services are profitable, which are not viable?
Success factors for car dealership restructuring: What makes the difference now
Based on our experience in European and international markets, three critical success factors have emerged:
Radical transparency across all KPIs
Consistent end-to-end view of results, contribution margins, inventories, and capacities across all locations and brands. Many crises had long been visible in the figures; what was lacking was a consistent view and the right actions.
rpc approach: Data-driven transparency as the basis for measurable performance optimization.
Clear positioning in the market
Not every car dealership has to be everything to everyone. The question of segment, region, and value proposition is crucial for survival in restructuring. Without a clear answer, you become an interchangeable "fulfiller" of manufacturer programs or you are forced out of the market.
rpc approach: Strategic positioning for sustainable business models with genuine differentiation potential.
Active stakeholder management
Successful car dealership restructuring requires alignment between shareholders, management, manufacturers, banks, and executives.
- Manufacturers must consider network strategy and dealer profitability together
- Banks need robust, realistic business plans with demonstrable earnings potential
- Management needs managers internally who actively drive change
rpc approach: People-oriented transformation with a focus on all stakeholders.
rpc as a partner for car dealership performance and restructuring
OUR PERFORMANCE PROMISE
Performance optimization + restructuring expertise = measurable results
We combine our proven performance consulting with turnaround and restructuring expertise, working closely with specialized restructuring and insolvency experts when necessary.
OUR APPROACH
From analysis to sustainable implementation
AI & Innovation: Data-driven analysis and intelligent process optimization People: Involvement of all stakeholders and development of internal change drivers
Experience: Focus on profitable customer interactions across all touchpoints
Performance: Measurable top-line and bottom-line improvement
OUR ADVICE
Act early, don't react
Car dealerships should not wait until the bank seeks critical discussions or the manufacturer asks questions before considering restructuring. The most successful turnarounds begin as performance programs; early on, fact-based, and with a willingness to make structural decisions.
To manufacturers: Retail partners are strategic assets in the transformation, not just sales channels. A wave of restructuring in the retail sector will weaken the entire system in the long term. Strong, powerful retail networks are essential for successful e-mobility and new mobility concepts.
When optimization is not enough, the real work begins
Restructuring in the automotive industry is no longer a marginal issue, but rather a structural trend, especially in Europe. The skills required to improve performance are the same ones that determine success in restructuring. The difference: the timeline is shorter, the scope for action is narrower.
rpc is your partner for intelligent customer interactions, measurable performance optimization, and sustainable business models in the automotive trade — in good times and especially when it matters most.
