Goodbye to mercedes

Ooops, did I say Mercedes?

Well not since the last July.

For Peter Lovett, managing director of the Dick Lovett Group, set up by his father in 1966, the defining moment in his relations with the German car-making giant was when in June he wrote to all his Mercedes-Benz customers, many of them who had being buying the product for more than two decades.

He told them that after much consideration and discussions with Mercedes-Benz, he had decided to relinquish the franchise, not an easy decision for someone in charge of a company that had built up an enviable reputation for customer care.

That it has made a pretty good job of this is reflected in the fact that Lovetts is in the top 10 private groups in the UK in terms of pre-tax profits, and 21st nationally in all groups in the country including the plcs.

Few would deny that with so many changes in the industry, particularly as applied to Swindon, the Dick Lovett Group stands out as one that cares for its customers and employees and the changes that are going on can best be described as traumatic.

While reluctantly casting aside Mercedes the group still has the prime marques of Porsche and BMW and of course, the new Mini.

So how does Peter Lovett see the development of his group?

"We have been here since 1966 and although I don't have a written life plan I've based a lot of my thinking on looking forward a decade at a time, seeing what we can achieve against that 10-year plan and then forming the next one to take the business forward," he said.

"I am very proud to say that I have always exceeded my expectations in terms of those 10-year periods. Recently we came to another and it was time to stop, think, focus and look where we are going for the next decade.

"Some of this has been brought about by changing legislation, changes in manufacturers' plans, the way they wish to distribute cars, and the way they want to have their relationships with their dealers.

"When the Mercedes-Benz problem surfaced, I had to consider how it all fitted in with the business.

"Could I transfer a sizeable, respected and well-funded business on to the third generation of the Lovett family so that it was not too much at risk and continue to provide first class customer service, look after staff and go properly into the future."

Here Peter Lovett emphasises the question of staff and consideration for their future in the decision-making process.

The group, which extends well beyond Swindon, employs more than 400 people.

"I can see very clearly what the group needs to do," he says.

"It's a great shame that we got to a quarter of a century with Mercedes-Benz and that having been offered the opportunity within their new strategy, we were not going to go forward with them.

"It was a commercial decision. The rules of engage-ment, so to speak, had changed in the year that we had to think about whether it was a viable opportunity for us or not.

"And of course as our business had grown, and although we were well known and respected as Mercedes-Benz dealers, it was not actually the core of our business.

"We had to make a decision. There wasn't an option, sadly, to stay as we were.

"That would have probably been the easiest thing to have done, improve our already excellent facilities in Swindon and just stay as a Mercedes-Benz dealer in the town.

"However, all things con-sidered, this was not possible."

But it wasn't just a question of improving the facilities in Swindon at considerable cost.

To keep the franchise it would also have meant acquir-ing several other dealerships in what were then adjoining territories and improve those facilities, all within a certain time frame.

"This would have put a lot of pressure on us when we were also being offered other excellent opportunities," says Mr Lovett.

"It is not that we are short of opportunity. It is making the right decision that provides the right platform for the business to go forward over the next decade.

"I won't say it is to take away risk, because we are a business that has always taken a good degree of risk.

"But it is balancing the risk against reward so we can see where we are going.

"We are moving forward with Porsche and have re-acquired the Ferrari franchise which now comes with Maserati.

"I am particularly pleased about that.

"However, I would empha-sise that we still have a good relationship with Daimler-Chrysler because we are going to carry on with Chrysler Jeep, and there are major changes taking place.

"As with Mercedes-Benz, its owner, Daimler Chrysler is redefining territories as part of its overall strategic plan.

"In the case of the Chrysler Jeep division it is not as drastic as with Mercedes and we are able to make changes with them.

"Our Chrysler Jeep dealer-ship in Hungerford will be moved to Swindon to the showroom being vacated by Porsche when it moves into our refurbished building on the Meads Roundabout on Great Western Way later this year.

"The Hungerford site, along with the our BMW dealership opposite it, will be refurbished and the present Chrysler Jeep site will become a new Mini Centre.

"We will also be opening a dedicated Mini Centre in the building adjacent to our BMW site in Rushy Platt in Swindon, from which we sell used cars at present.

"So, with our various fran-chises, we will have a presence in various locations in Swin-don, to Cheltenham in the north and Bristol in the west.

"As to Porsche, when my father started the business in 1966, the first two cars he had at our premises in Wroughton were Porsches.

"So, since I was a little boy I have been involved with these cars, initially driving one on L plates.

"My whole life has centred around these cars. Porsche has offered us an extra opportunity and we are going to take the marque into Cardiff.

"So we will have a row of Porsche centres Swindon, Bristol and Cardiff, represent-ing a substantial chunk of Great Britain, for which we will be very proud.

"BMW are looking for great growth and are having to make tough decisions, just as we are.

"It has risen above the problems with Rover and has now come out more successful than ever in the past.

"One just has to see the line-up of new models they are showing at this week's Paris Motor Show, including the exciting new Z4 sports car, which replaces the incredibly successful Z3, to see how well they are doing.

"And their new Mini, made for all world markets at Cowley in Oxford, shows their deter-mination to conquer new markets with a British-made car of impeccable heritage.

"Mini has been a great success, and BMW has demonstrated huge commit-ment to manufacturing in this country, not only cars but big engine plants.

"So we are feeling very comfortable now having had a year of difficulty in deciding the right thing to do with the route we are going to go."

And were there sleepless nights spent considering the highly complex negotiations with Mercedes-Benz worth it?

"Oh yes. It wasn't easy but once the decision was made we just got on with," he says.

"We communicated with all our customers about the details of the handover and explaining what we were doing and why.

"But what I would emphasise is that all our staff were kept completely informed of what was going on through monthly meetings and what their position was.

"Everyone had a job, most going over to the new dealer or, if they chose, staying with us. Looking after our staff as well as our customer has always been our prime consideration."

And what about the site, would it go to the new Mercedes appointed dealer, or would Peter Lovett be sitting in his office above the empty showroom enjoying the view until he had a use for it?

"It won't be going to the new dealer," he says with a smile.

"As I have already indicated, while big is not necessarily beautiful, one-to-one customer care is.

"So, too, is not losing sight of what the customer wants in applying the Lovett name to long-term responsibility and commitment."

Well there you go then, new horizons for a man who was a not unsuccessful race track competitor in younger days who passionately loves cars and everything to do with them.

Not for him the easy option of taking up what might have appeared to be a golden opportunity, but involving massive investment probably for smaller returns.

Peter Lovett bit the bullet and now looks forward to an even better future for his company, his staff and his customers.