Auto Retail Agenda: 25 September 2023
24 September 2023
- ARNOLD CLARK PROFIT FALLS FROM RECORD HIGH
- HOUSE OF LORDS DEMANDS ANSWERS ON ZEV MANDATE
- DAVID BECKHAM OPENS HR OWEN MASERATI HATFIELD
- VERTU STAYS IN BTCC FOR 2024
- LISTEN AGAIN: AUTO RETAIL LIVE
- CAZOO SHARE PRICE FALLS ON DEBT FOR EQUITY SWAP
- UAW TARGETS PARTS DISTRIBUTION CENTRES
- STOCKWATCH: Pendragon up nearly 50% as bidding war continues
- COMING UP: Pendragon H1, UK GDP
- UK CONSUMER CONFIDENCE HIGHEST IN TWO YEARS…
- …BUT UK RECESSION RISK HEIGHTENS
Arnold Clark profit falls from record high
Arnold Clark saw profit before tax in the year ended December 2022 drop from £263m to £173.5m. This was despite revenue increasing from £4.74bn to £4.92bn, driven largely by new car unit price increases.
However, the directors stressed that 2021 was a record year – and 2022’s performance ensured it was still Arnold Clarks’ second most profitable year ever.
The group reported significant increases to its underlying operating costs, particularly employment costs which rose by £45m, and increased property rates, finance and utility costs.
In October 2022, the retailer brought forward its annual pay review exercise by three months, with pay adjustments of up to 9% effective from January 2023. Its minimum pay rates “remain significantly above the proposed national minimum wage [of £10.42] announced by the UK government in November 2022”.
CEO Eddie Hawthorne referenced the retailer’s 2022 Christmas Eve cyber attack but said that “despite the system issues experienced at the start of the year, I remain cautiously optimistic about 2023”.
* Read about how much you should be paying your staff in the latest Auto Retail Profit: sign up here for a free two-month trial
House of Lords demands answers on ZEV Mandate
The House of Lords Environment and Climate Change Committee has written to PM Rishi Sunak demanding clarification on the petrol and diesel car phase-out. It follows the PM’s announcement of a delay from 2030 to 2035 for new petrol and diesel car sales.
Chair Baroness Parminter has posed two questions to the transport secretary Mark Harper:
How will the recent decision to delay the ban on the sale of new petrol and diesel vehicles from 2030 to 2035 impact the UK’s ability to meet the overarching target of achieving net zero by 2050?
What plans does the government have to introduce a ZEV mandate in the light of the decision to delay the ban on sales of new petrol and diesel cars from 2030 to 2035?
Harper’s response will be published on the committee’s website upon receipt.
It is expected long-overdue details of the ZEV Mandate will be announced this week, ahead of it coming into force on 1 January 2024.
David Beckham opens HR Owen Maserati Hatfield
Maserati’s first UK ‘new store concept’, HR Owen Maserati Hatfield, was opened last week by the brand’s global ambassador David Beckham. HR Owen CEO Ken Choo also attended the event at the retailer’s five-showroom, three-workshop, 110,000 sq.ft multi-marque facility.
Vertu stays in BTCC for 2024
Vertu has signed a multi-year deal for its Bristol Street Motors brand to remain in the British Touring Car Championship as primary partner to the Excelr8 team. Last year, its driver Tom Ingram was crowned 2022 BTCC champion.
This year, Bristol Street Motors launched ‘The Street’ fanzone, touring events such as the Goodwood Festival of Speed, and Robert Forrester said Vertu will “continue to engage with BTCC fans to enhance their experience on race weekends”.
Listen again: Auto Retail Live
You can now listen back to the latest Auto Retail Live Business Briefing, held in partnership with Auto Trader and featuring Lookers Duncan McPhee, eStar Truck & Van’s Steve Bridge, and Auto Trader’s Marc Palmer – just click here
WORLD NEWS
Cazoo share price falls on debt for equity swap
Cazoo’s share price plunged further last week, closing at $0.58 after starting the week at $0.99. On Thursday, founder Alex Chesterman’s stake was almost wiped out in a US debt-for-equity swap deal. $630m of debt was swapped for $200m of new debt and equity stakes. Viking Global Investors, a US fund, is now its biggest shareholder.
Last week, a City AM editorial said Cazoo’s flop was proof that New York is “far from a panacea for British firms looking to list on the public markets”.
UAW targets parts distribution centres
US retailers are hoping preparations will be sufficient to cushion the blow of the UAW’s latest strike action. On Friday, it was announced 38 GM and Stellantis parts distribution centres in 20 states will join the strike.
Ben Keating, owner of Keating Auto Group, said it was the wrong move. “By striking at a parts distribution warehouse, I don’t think that puts pressure on the manufacturers and much as it does the retail customer and not being able to get their vehicle fixed.”
STOCKWATCH
Closing prices on 22 September 2023 and weekly change
Pendragon up nearly 50% as bidding war continues
Auto Trader Group 625.0p (+5.6p / +0.9%)
Caffyns 550.0p (+35.0 / +6.5%)
Halfords 203.2p (+6.0p / +2.9%)
Inchcape 766.0p (-26.5p / -3.4%)
Lookers 129.4p (n/c)
Motorpoint 88.0p (-3.0p / -3.3%)
Pendragon 30.1p (+11.62p / +47.8%)
Vertu 74.2p (+8.1p / +11.5%)
COMING UP
Wednesday, Pendragon H1 results
Wednesday, BRC shop price index
Thursday, Nationwide house price index
Friday, UK GDP
6 December: NFDA Driving Digital: Special Edition. Sign up here: https://tinyurl.com/mt2y378d
MONEY MATTERS
UK consumer confidence highest in two years
UK consumer confidence has risen to its strongest level since January 2022 just before the Russian invasion of Ukraine. Economists had predicted a small drop in the GFK consumer confidence index.
UK recession risk heightens
Economic activity contracted at its fastest pace since the financial crisis, due to a steep downturn in services. This raises the chances of a recession, according to the S&P Global PMI.
Tags:
Arnold Clark, Cazoo, Consumer confidence, GDP, HR Owen, Lookers, Maserati, Pendragon, recession, UAW, Vertu, ZEV Mandate 
Why Subscribe?
As an auto retail executive you need insightful and unique industry intelligence to boost your business potential. Here’s a taste of what Auto Retail Network has to offer:
- Get informed and boost your business potential
- More than 1,200 fellow executives have joined us since launch
- Independent, carefully crafted, unique content relevant to you and your business
- Develop a greater awareness of market trends and opportunities
- Access to a wide range of materials whenever, wherever and however you want it
- Significant discounts on ARN events, reports and other publications
