• FCA: ‘NO INTENTION OF BANNING GAP INSURANCE’
• AUTO TRADER TRENDED VALUATIONS OPEN TO ALL
• FORRESTER AND VEICHMANIS JOIN AUTO RETAIL LIVE
• RETAILER EMPLOYEE GUILTY OF FRAUD WITH PRE-PAYMENT CARDS
• PENSION FUND UPS STAKE IN CAFFYNS
• CARVANA LAUNCHES SAME-DAY DELIVERY
• VROOM CEASES ECOMMERCE, CUTS 90% OF JOBS
• STOCKWATCH: Motorpoint issues profit warning
• COMING UP: Auto Retail Live on used cars
• CHANCELLOR CONSIDERS FURTHER NI CUT
• RUMOURS THAT CHILD BENEFIT MAY CHANGE

FCA: ‘no intention of banning GAP insurance’

The FCA says it is “disappointed with the market’s response to our warnings to improve the value of GAP insurance for customers”.

The finance regulator was responding to reports last week it was considering an effective ban on retailers from selling GAP insurance.

“We have no intention of banning GAP insurance as a product line,” it told Auto Retail Agenda.

The regulator explained that in September 2023, it warned GAP insurers that the product was unlikely to be providing fair value to customers. In 2022, only 6% of the amount customers paid in GAP insurance premiums was paid out in claims.

“The FCA has seen many examples of firms paying out up to 70% of the value of insurance premiums in commission to parts in the distribution chain, such as motor dealerships.”

Instead of a ban, the FCA spokesperson said it has told GAP insurance product providers “to take immediate action to show how customers are getting a fair deal, or we will intervene”.

FCA director of insurance Matt Brewis added: “This is an early signal of the work we’ll be doing under the Consumer Duty.

“If the firms are unable to prove they’re providing fair value to their customers, they should expect further action from the regulator.”

In other FCA news, the regulator has published a help page to answer queries on its investigation into motor finance complaints around discretionary commission agreements (DCAs).

 

Auto Trader Trended Valuations open to all

Auto Trader has given all its retailers access to its new Trended Valuations data solution. It shows what a vehicle has been worth over the past six months – and how its value is forecast to change in the next six months.

Forward forecasts have been proven to accurate within 5%, and 1% up to a month forward.

TrustFord Bristol business manager Michael MacDonald said the service will be “hugely powerful for managing part-exchanges, especially where new car lead times can mean the transaction is months away”.

Allen Motor Group used car buyer Andrew Muffett said it will be essential because “retail and trade markets don’t always move in sync – a point-in-time trade valuation only tells part of the story when sourcing and puts margin at risk when you hit the retail market”.

 

Forrester and Veichmanis join Auto Retail Live

This Tuesday’s free Auto Retail Live webinar will look into both the used car landscape in 2024 and agency’s impact on part exchanges. Vertu CEO Robert Forrester and Carwow CEO John Veichmanis will be joined by One Auto API’s Rupert Pontin.

Topics for discussion include a market overview and where we are now, the outlook for Q1 valuations and the March plate change, plus the influence of agency on used cars and trade-ins.

The first Auto Retail Live webinar of 2024 is free and the time-efficient 40-minute briefing starts at 2pm on Tuesday.

* Auto Retail Live used car landscape: sign up here

 

Retailer employee guilty of fraud with pre-payment cards

A mother who used a retailer’s pre-payment cards to pay for nursery fees and a carpet has been given a suspended prison sentence. Lucy Raw worked for Driven Car Sales and used more than £4k on pre-payment cards issued by the retailers’ warranty provider Momentum Warrantees to settle claims.

http://tinyurl.com/mpwn94n5

 

Pension fund ups stake in Caffyns

Maland Pension Fund and Andrew Perloff have upped their stake in Caffyns from 16% to 17.4%. Caffyns shares fell 3.1% last week.

 

 

WORLD NEWS

Carvana launches same-day delivery

Embattled US online used car retailer Carvana has launched same-day deliveries to Birmingham, Alabama residents. The retailer says its first party logistics network and inspection and reconditioning centre in Bessemer, Alabama has helped make same-day delivery possible.

http://tinyurl.com/5n7krnb5

 

Vroom ceases ecommerce, cuts 90% of jobs

US online used car retailer Vroom is winding down its online ecommerce division to preserve liquidity. Used car transactions through vroom.com will be suspended and it will sell its current inventory through wholesale channels.

It will also cut 800 jobs, or 90% of its workforce.

However, its captive finance unit will continue, as will its AI-powered analytics platform CarStory.

http://tinyurl.com/mr2vy23e

 

 

STOCKWATCH

Closing prices on 26 January 2024 and weekly change

Motorpoint warns FY24 profit will be £5m-£6m below expectations

Auto Trader Group 741.8p (+29.0p / +3.9%)

Caffyns 470.0p (-15.0p / -3.1%)

Halfords 174.8p (+0.1p / +0.05%)

Inchcape 683.5p (+32.5p / +4.8%)

Motorpoint 98.7p (+3.7p / +3.8%)

Pendragon 34.2p (-0.1p / -0.2%)

Vertu 65.9p (+0.3p / +0.4%)

 

 

COMING UP

Tuesday, public sector net borrowing

Friday, GfK consumer confidence

30 January, Auto Retail Live used car landscape: sign up here

 

 

MONEY MATTERS

Chancellor considers further NI cut

There may be another reduction in national insurance in the March budget. The cut from 12% to 10% recently went live; costing £9bn, it saved the average worker £450 a year.

A further cut could be rolled out immediately, would go to those who are working as part of the government’s jobs narrative – and excludes pensions, whose pensions are already protected by the triple lock.

http://tinyurl.com/ymk6ejvp

 

Rumours that child benefit may change

There are renewed calls to change the child benefit system. The high-income threshold has been frozen since 2013, meaning growing numbers of parents are losing out. It is also based in individual rather than household income – meaning a family with a total income of £99,999 can keep the full benefit, while a family with a single income of £60,000 get nothing.

There are rumours the chancellor may increase the threshold from £50k to £60k in the budget on March 6^th.

http://tinyurl.com/3aacwkrw