News - Holden
Penfold revamps brand portfolio
One of the best: Penfold Holden has been in operation for almost 30 years, but the dealership group has now handed the franchise back to the car-maker.
Top Holden dealer hands back franchise – and takes on Volkswagen
17 July 2015
ONE OF Melbourne’s best-known Holden dealers, Penfold Motors, has reluctantly
handed back the franchise to GM because it is unable to reach agreement on a
plan to downsize the Holden dealership to meet current sales expectations.
In addition to Holden, Penfold Motors has Mazda and Audi franchises and is
opening a Volkswagen dealership in Doncaster. The company handed back the
Mitsubishi franchise in 2012 and operates a fast-stock-turn used-car operation
from that site.
The Burwood-based business was started in the well-to-do eastern suburbs
heartland of Melbourne by Alan Johnstone as a used-car operation 51 years ago.
It took on Holden in 1987 and went on to become Holden’s top-selling Victorian
dealer for 10 years.
Today it is run by sons Greg and Sam Johnstone.
The Holden decision follows discussions with GM about the future of the site
which is geared for 20 per cent market share rather than the 10 per cent mark
Holden now hovers around.
In addition, the demographics of the market area are rapidly moving more
upmarket and away from Holden’s traditional buyers. Holden share at Penfold has
dropped to the point where they are now only sixth in the Holden sales stakes
in Victoria while sales in the other franchises are climbing.
Greg Johnstone told GoAuto that continuing to run the Holden franchise in the
current premises was “really not sustainable – we could not make it work”.
He said that Penfold offered to re-establish a new Holden dealership on the
former Mitsubishi site which is a smaller site nearby but GM Holden “did not
come to the party”.
He told GoAuto: “We really did not want to give up Holden but we did not have
any other alternative site other than the former Mitsubishi dealership.
“We like Holden. We have sold a lot of Holdens and we would like to have them
back at some stage.”
Mr Johnstone added that Penfold would miss the impact the Holden business,
especially Holden parts sales, has on the company’s bottom line. He said that
many of the staff at the Holden dealership will be transferred to Doncaster to
run the new Volkswagen site.
He also said the company does not have any current plans for the Holden site
which will operate for about three months more.
“We don’t have any other franchise to put in there and there are really no
franchises that I know of that would be looking at it,” he said. “We could sell
it or lease it but at this stage we really don’t know.”
GM Holden director of communications Sean Poppitt told GoAuto that there was
hope that Penfolds and Holden could work together again in the future.
“Penfolds has been a strong partner with Holden for a number of years," he
said. "The situation was dealt with on a completely amicable basis between both
parties and eventually we were unable to come up with a mutually agreeable site.
“We fully hope that in the future Penfolds will be able to find another
site and we will welcome them back into the Holden network.”
Mr Poppitt said that dealers were continuing to invest significantly in the
Holden brand highlighted by a multi-million dollar new Holden dealership, Alto
Holden, in Sydney’s Chatswood.
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