Bosses at one of the biggest car dealerships in Sussex were counting their losses today following the demise of the MG Rover group.

Caffyns, which has eight MG Rover franchises in Sussex and Kent, said it was owed at least £54,000 by the collapsed car maker on March 31.

The family-run company now expects to incur additional costs, including dozens of warranties which may no longer be funded by MG Rover.

The Eastbourne-based group still has in stock new and used MG Rover cars worth £3.6 million, which are being sold at "massive" discounts.

Caffyns is one of the biggest MG Rover dealers in the country but has been scaling back its links to the West Midlands car maker since the mid- Nineties.

Its MG Rover branches in Brighton, Worthing and Eastbourne are currently being refranchised to another car manufacturer, possibly Vauxhall.

Its branches in Lewes and Uckfield will continue to trade as used car and after-sales operations while the future of its dealership in Seaford is uncertain.

Caffyns also has two MG Rover Parts outlets in Hailsham and Portslade, both of which are unaffected by the crisis at the Longbridge plant.

Turnover from the group's MG Rover dealerships in the six months to September 30, 2004, was £15.8 million. Profits were £355,000.

Caffyns, which is listed on London's Alternative Investment Market (AIM), has seen the value of its shares slump byten per cent following MG Rover's ruin.

The company said the full cost of MG Rover's failure would become clear when its final results for the year to March 31 are published on May 27.

Chief executive Simon Caffyn said: "Since the mid 1990s, in line with MG Rover's declining market share, we have taken action to reduce our MG Rover dealerships from 21 to eight.

"Similarly, we have, in recent months, taken steps to reduce our exposure to MG Rover vehicle stocks. We have priced our stock attractively and demand for this vehicles is strong.

"While there will be some disruption, our actions over the last few years and our swift response to the current situation has ensured this is kept to a minimum."

Established in 1865, Caffyns employs about 800 staff in 32 showrooms across Sussex with franchises including Audi, Skoda, Volkswagen and Ford.

Dinnages, in Haywards Heath, is the only other car dealer in Sussex with an MG Rover franchise but gains most of its business from its links with Ford.

Last night, pressure was mounting on the former directors of MG Rover after it emerged an independent inquiry will attempt to pin down how much money they took out of the group.

Any hopes of selling MG Rover were dashed last Friday when Chinese car maker SAIC pulled the plug on a potential deal to buy the West Midlands firm.

More than 4,000 MG Rover workers received redundancy notices yesterday.

April 19, 2005