Auto Retail Agenda: 11 September 2023
10 September 2023
- VINES TURNAROUND CONTINUES WITH £5.7m 2022 PROFIT
- CITROEN RETAILER MOVES TO MG AFTER STELLANTIS CHANGES
- NFDA DEALER ATTITUDE SURVEY IN NEW PROVIDER
- LOOKERS’ DUNCAN McPHEE CONFIRMED FOR AUTO RETAIL LIVE
- BIRD FOUND AT ARNOLD CLARK
- LITHIA MOTORS’ DeBOER MADE $16.4m IN 2022
- ASBURY BUYS JIM KOONS IN $1.2bn MEGA-DEAL
- STOCKWATCH
- COMING UP: UK unemployment and GDP
- ‘DON’T RELY’ ON TAX-FREE PENSION LUMP SUM
- BIG BANK SHARE BUY-BACK RIP-OFF WARNING
- CBI ‘WITHIN WEEKS OF RUNNING OUT OF CASH’
Vines turnaround continues with £5.7m 2022 profit
BMW and MINI retailer Vines saw profit before tax grow from £3.9m to £5.7m in the year ended December 2022, with turnover increasing from £196.2m to £218.6m. It is the third year running of profit growth, following several years of losses up to 2021.
Although service labour margins were up, it warned the proliferation of OEM service packs, the competitive nature of older car service business and a shortage of vehicle technicians is putting pressure on this area. “This business will become increasingly competitive during 2023.”
Vines faced several years of losses in the late 2010s due to issues such as large numbers of pre-registrations eroding margins on nearly-new cars. It lost £1.77m in 2018 – when it also warned about margin pressure from service packs – and repeated this loss in 2019.
It lost £196k in 2020, when it received more than £2m in government grants, before starting its current recovery.
Citroen retailer moves to MG after Stellantis changes
Harrogate’s Just Motor Group has switched from Citroen to MG following Stellantis’ contract termination and offer of renewal on new terms. “It just wasn’t going to be financially viable for us,” said sales director Kevin Tyrrell. “Historically, we’ve sold about 300 new cars a year from that site, but that wasn’t going to be possible under the new contract they offered.
“MG Motors stepped in with a better offer – it was perfect timing for us. Citroen has a 1.6% market share in the UK, whereas MG Motors has a 4.6% share, and it’s growing – so we’re definitely going in the right direction.”
NFDA Dealer Attitude Survey in new provider
The NFDA Dealer Attitude Survey is to be produced under a new data analyst company, with chief executive Sue Robinson promising a “fresh and easily accessible new look’. The closing date for the latest survey is today, Monday 11 September, at 5pm.
Lookers’ Duncan McPhee confirmed for Auto Retail Live
The upcoming Auto Retail Live Business Briefing will see Looker’s Duncan McPhee, eStar Truck and Van’s Steve Bridge and Auto Trader’s Marc Palmer all give their views and insight into the state of the UK marketplace and what’s expected to happen in auto retail in the next few months.
The free briefing starts at 2pm on Tuesday 19 September and those looking for a competitive advantage should join the 40-minute session – which includes the opportunity to ask questions to the panel. Sign up here: https://bit.ly/45NcHUo
Bird found at Arnold Clark
A budgie was found at Arnold Clark East Kilbride last week. The Scottish SPCA is now hunting for the green and yellow bird’s owners – and has tweeted for help.
WORLD NEWS
Lithia Motors’ DeBoer made $16.4m in 2022
Lithia Motors CEO Bryan DeBoer topped the US retailer compensation list for 2022 with a total package of $16.4m (£13.1m). Sonic Automotive’s David Smith was next up, with compensation of $13.3m (£10.6m). Roger Penske earned $12.4m (£9.9m), Group 1 Automotive’s Earl Hesterberg earned $12.1m (£9.7m) and Asbury’s David Hult earned $10m (£8m).
AutoNation’s Michael Manley, a Brit who was formerly CEO of FCA after a career in UK auto retail, was awarded a total compensation package of $8.3m (£6.6m).
Asbury Buys Jim Koons in $1.2bn mega-deal
Asbury Automotive has agreed to buy Jim Koons Automotive in a $1.2bn (£960m) deal that would be one of the largest in auto retail history. The deal would add 20 franchised retailers, six vehicle repair centres and a used car store. Koons Group reported $3.2bn (£2.5bn) in revenue in 2022.
STOCKWATCH
Closing prices on 8 September 2023 and weekly change
Auto Trader Group 602.2p (-5.2p / -0.8%)
Caffyns 515.0p (n/c)
Halfords 192.5p (+8.7p / +4.6%)
Inchcape 766.0p (-2.5p / -0.3%)
Lookers 128.6p (n/c)
Motorpoint 92.0p (-2.7p / -2.8%)
Pendragon 18.28p (-0.02p / -0.1%)
Vertu 67.2p (-2.6p / -3.7%)
COMING UP
Tuesday, UK unemployment
Wednesday, UK GDP
Thursday, Auto Trader AGM
19 September, Auto Retail Life September business briefing. Sign up here: https://bit.ly/45NcHUo
MONEY MATTERS
‘Don’t rely’ on tax-free pension lump sum
In April 2024, the government will scrap the pensions lifetime allowance of £1,073,100. This is the amount you can put into a pension without having to pay up to 55% tax when you withdraw it. The government will also fix the tax-free lump sum at 25% of today’s allowance: £268,275. There are no plans to increase it – and the move is now being described as a stealth tax, with more people are set to breach it.
Big bank share buy-back rip-off warning
Share buy-backs are booming, with repurchases by UK companies almost tripling last year to £56.6bn. They increase earnings per share and are a way of giving cash back to shareholders – a ‘synthetic dividend’. However, some criticise them as an unimaginative use of capital by boards.
New research by Michael Seigne and Jorge Osterrieder now suggests that companies doing buy-backs are being “totally ripped off” by the investment banks that execute them, due to a lack of scrutiny from finance departments and investors. Some companies are paying way more to trade their own shares than others and “big fund managers need to start bashing heads together at the companies they invest in”.
CBI ‘within weeks of running out of cash’
Business organisation the CBI is facing an urgent cash crunch and could be within weeks of running out of money. This has led it to hold talks about a potential tie-up with fellow lobbying group Make UK, the manufacturers’ trade body.
Tags:
Arnold Clark, Asbury, Auto Retail Live, CBI, Citroen, Dealer Attitude Survey, Jim Koons, Lithia, Lookers, MG, NFDA, pensions, Stellantis, Vines 
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