Opel/Vauxhall has served notice to terminate all contracts with UK and Europe dealers in two years’ time, during which the company will renegotiate franchising on a case-by-case basis.

The manufacturer, which was acquired by Groupe PSA last year, has 326 franchised dealerships across the UK and over a thousand across Europe.

Vauxhall spokesperson Denis Chick said the company did not know exactly how many UK dealerships the brand would leave, adding Vauxhall would aim to keep its franchised dealer network as the second-largest in the country.

“We have currently the second-largest network in Britain after Ford, and we know that we will end up with the second-largest network … We won’t fall down the ranking. It will still be a big network, but it will be right-sized for the business.”

He said Vauxhall Finance would be part of the discussions with dealers, but contracts with the finance house would not be affected. Banque PSA and BNP Paribas jointly acquired Opel/Vauxhall Finance in November.

Chick added that the aim of the Europe-wide operation was contract harmonisation, which in the UK would involve giving all dealerships the option to sell commercial vehicles.

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By GlobalData

On Monday, Stephen Norman, Vauxhall managing director since January, said: “The requirements of the industry going forward and the requirements of the brands Opel and Vauxhall … would not require as many retail outlets as the brands currently have.

A statement from the company on Tuesday read: “Vauxhall is improving efficiency in every area of its business. This includes our current contractual framework with retailers.

“We will adapt our retailer agreements to ensure working together is simpler, quicker and more innovative, ultimately benefiting our customers. Our retailers are, and will remain our primary route to the market.”

Vauxhall last restructured its franchised network in 2013. At the time, dealership numbers in the UK fell from 349 to the current 326.