23 June 2019

• PROFITS UNDER PRESSURE IN 2018
• RENAULT EXAMINES MULTIPLE RETAIL METHODS
• MERCEDES OFFERS 48-HOUR TEST DRIVES
• WOMEN WIN RISING STARS AWARDS
• VW LAUNCHES SUPERMARKET CAR SHARE SCHEME
• IRELAND CONSIDERS ENGINE BAN BY 2030
• STOCKWATCH – BCA takeover talk tempts investors
• LAUNCH DIARY – BMW 8-series Gran Coupe, Mercedes-AMG GT R
• COMING UP – Auto Retail Live Profit Briefing
• MONEY MATTERS – Interest rates remain on hold
• OUR BLOG – Expansion and diversity key to survival and success

Profitability under pressure in 2018

Three retail groups announcing their annual results this week have seen profitability come under pressure.

Hendy Automotive’s 2018 profit before tax dropped to £3.6 million with a turnover of £556.3m, against £5.0m in 2017 on £532.8m turnover. During 2018 it bought the £15 million-a-year Seward business adding Suzuki and Renault/Dacia, and its latest accounts show that in March this year it agreed to pay £21 million for the Westover business, which should see the 2019 turnover pass £1bn.

Ford retailer TC Harrison which also has a JCB operation and a profitable contract hire business saw its overall profits drop slightly from £2.1m to £2.0m on a turnover that increased from £287.7m in 2017 to £304.8m last year.

And after a year of transition as Vauxhall was incorporated into the PSA group, Drive Motor Retail reported a significant profit drop in 2018, down to £1.7m from £6.7m in 2017. Turnover for the group remained almost flat at £219m for the year.

Renault examines multiple retail methods

Renault is exploring multiple new retail initiatives, according to UK managing director Vincent Tourette.

In an interview for sister publication Auto Retail Bulletin, Mr Tourette confirmed the brand was in discussions with both the major supermarket brands, as previously reported in Auto Retail Agenda, as well as other retailers.

Mr Tourette said he was following the progress of Ford’s sales outlet in Next that was set up by Rockar in Manchester and had been in touch with Rockar although he was not working with the digital retailing specialist.

In a wide-ranging interview, Mr Tourette said he was aiming to increase the network’s average return on sales from just above 0.4% now to 1%. He said he was also hoping to raise the overhead absorption level from “below the industry average” through improved workshop capacity.

* Read the full interview with Mr Tourette in next month’s Auto Retail Bulletin.

Mercedes offers 48-hour test drives

Mercedes retailers will book demonstrators out for 48-hour test drives through next month under an initiative to give potential customers more time in the car and to familiarise themselves with its systems.

Applicants can book a slot either online or with a dealer in the project which runs to 31 July. Some cars including AMG high performance models are not included.

Women win Rising Stars awards

Women from two retailers have been picked as Rising Stars by Autocar in its Great British Women in the Car Industry report.

Nev Hart, learning and academy team leader at Jardine Motors Group and Zoe Lawson, head of corporate sales at Marshall Motor Group, won the People Development and the Sales categories respectively.

WORLD NEWS

VW launches supermarkets car share scheme

VW has teamed up with two supermarket chains for an EV car sharing scheme it launches next week in Berlin with an initial pool of 2,000 cars.

Initially WeShare will consist of 1,500 e-Golfs and 500 E-up units, followed in mid-2020 by the ID3. It will be rolled out in other German cities and is being planned for more countries.

Ireland considers petrols and diesels ban by 2030

The Irish government is considering a ban on the sale of new internal combustion engine cars by 2030, 10 years earlier than the UK.

http://bit.ly/2Y6CEf3

STOCKWATCH

Closing prices at 21 June and weekly movement

BCA takeover talk tempts investors, Lookers continues fall

BCA 238.0p (+49.7p)

Cambria 60.0p (n/c)

Caffyns 410.0p (+25.0p)

Inchcape 614.5p (-2.5p)

Lookers 65.6p (-9.1p)

Marshall Motor Holdings 157.5p (-2.5p)

Motorpoint 229.0p (+9.0p)

Pendragon 19.1p (+1.2p)

Vertu 39.5p (-0.5p)

Auto Trader Group 562.2p (+0.8p)

LAUNCH DIARY

BMW 8 Series Gran Coupe. Four door, longer wheelbase version of new 8 Series coupe. From £69,340.

Mercedes-AMG GT R Roadster. 197 mph, 585 bhp V8 supercar. From £178,675.

COMING UP

Friday: Trends in household final consumption expenditure (ONS)

7 July: British Retail Consortium Shop Price Index

9 July: Auto Retail Live Profit Briefing – Maximising aftersales profits

MONEY MATTERS

Interest rates remain on hold

The Bank of England voted to keep the base rate at 0.75% this week after warning of flat growth for Q2 and growing economic risks domestically and internationally.

https://bit.ly/2x84trn

FCA publishes first annual perimeter report

The FCA has published the first of what will be an annual perimeter report, looking at what it can and cannot regulate and what protection consumers can expect from the financial products they buy.

https://bit.ly/2Frxy5U

CLICK HERE TO READ OUR BLOG – Expansion and diversity key to survival and success

John Swift

Editor

Auto Retail Agenda

Tags: Auto Protect, Drive Motor Retail, Hendy Automotive, Mercedes, Renault, TC Harrison