Martin Ward

THE trend for dealers, dealer groups and OEMs to tap into shopping-centre traffic to expose their cars looks to benefit as department stores and other general retailers move to cut down on the amount of space they are renting.

As these general retailers seek to cut their exposure to shopping-centre rents, the downward pressure on the cost of space is falling into the hands of the car industry and has the potential to accelerate the trend to display cars in major shopping hubs.

A recent report in the Australian Financial Review said that AP Eagers is “emerging as a partial saviour of the ailing department store Myer”.

The report said that AP Eagers is in discussions with a major shopping-centre owner in Brisbane to take over 3000 square metres of floor space currently leased by Myer, which is keen to downsize.

The CEO of AP Eagers, Martin Ward, told GoAutoNews Premium that AP Eagers was talking to “a number of existing players who may wish to reduce space”.

“Myer has been mentioned as a potential company that may wish to reduce space,” he said.

But Mr Ward said that AP Eagers was having the discussions with the shopping centre and not Myer.

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“AP Eagers is only dealing directly with centre owners and is not dealing directly with outgoing tenants,” he said.

The plan is to take a space equivalent of a large car showroom and place vehicles from AP Eagers’ OEM suppliers. The arrangement could emphasise OEMs and distributors who want to aggressively get their vehicles into high-traffic areas such as shopping centres.

Myer is on record as saying it wants to downsize its floor space. Previously, David Jones has sublet space within its department store and introduced some specialist clothing brands operated by the wholesaler or manufacturer.

In the AFR article, Mr Ward said he was “in negotiations on price” regarding the shopping-centre plan for Myer in Brisbane and hoped to have an agreement by June.

The newspaper said AP Eagers was planning a rooftop service centre for the brands.

The deal would include a store for its Carzoos used-car business. Carzoos was launched in 2016 at Westfield Garden City and North Lakes shopping centres in Brisbane.

AP Eagers has previously had pop-ups for its Infiniti franchise and has committed a large area within the 51-hectare Brisbane Auto Mall at the city’s airport that will open in 2021.

AP Eagers has 114 car dealerships and 27 car brands, including all of the top-10 makes.

By Neil Dowling