Auto Retail Agenda: 16 March 2020
15 March 2020
- CAZOO LOSES CFO
- RETAILERS SPRINT TO BEAT EV GRANT CUT
- PENDRAGON APPOINTS NEW NON-EXEC
- MOTORPOINT SHAREHOLDER BUILDS STAKE
- NEW CAR SALES BANNED IN ITALY
- RETAILERS KEY TO GM’S EV PLANS
- LAUNCH DIARY – Vauxhall Corsa-e, BMW 2 Series Gran Coupe
- COMING UP – Pendragon results, Auto Retail Live Profit Briefing
- RECESSION FEARS GROW
- ASTON MARTIN RESCUE DEAL REVISED
- BLOG: What a week for Lookers
- BLOG EXTRA: Coronavirus planning
Cazoo loses CFO
Online-only used car retailer Cazoo has lost its chief financial officer less than a year after he started and only three months after the new-start business began selling cars.
Cazoo has no immediate plans to replace Mr Gersh, with a spokesman adding: “Alex Gersh has moved on from Cazoo. We have a finance director and strong finance team in place within the business so have no immediate plans to replace this role.”
Cazoo was founded by Alex Chesterman, the entrepreneur behind property sales platform Zoopla. The firm has raised £55 million in funding and is launching two months later than it originally stated.
At the time of his appointment in May 2019, Mr Gersh’s, who moved from Betfair, said: “After spending much of my career in later stage listed businesses, I am looking forward to being part of the journey of an early stage business with huge ambition.
“Alex Chesterman has a proven track record of building and growing incredibly successful consumer-facing businesses and I am excited to be part of this new venture. Cazoo is set to transform the biggest retail space and deliver a far better experience for UK used car buyers.”
Mr Chesterman added: “We have plans to transform the used car market in the UK and Alex’s considerable experience is a real win for Cazoo and will be invaluable to us. His experience of being involved in businesses of significant scale will be a great asset given our plans to grow Cazoo into a very large business over the coming years.”
Retailers sprint to beat EV grant cut
£400m of funding secured the Plug-in Car Grant to 2022-23 in last week’s Budget – but retailers and OEMs were caught unawares when, at 5pm on Wednesday, a clarification was issued announcing the amount had been cut from £3,500 to £3,000 and removed from cars over £50,000.
The changes were effective from midnight.
Auto Retail Agenda understands manufacturers immediately contacted retailers encouraging them to register as many cars on the old £3,500 amount as possible. Some retailers even returned to their offices to process confirmed orders.
Auto Retail Agenda has since learnt that OLEV (the government department responsible for the Plug-in Car Grant) recognises the issue. It has asked manufacturers to pass on all orders from genuine customers that were not able to be processed before the deadline and they will “assess and respond”.
Pendragon appoints new non-exec
Nikki Flanders will join Pendragon as an independent non-executive director on 1 April 2020. She will serve on the nomination committee, renumeration committee and audit committee. Ms Flanders will combine the role with her divisional manager position at power company SSE.
Ms Flanders has been COO of Opus Energy and held non-executive roles at Telefonica, M&S, WH Smith, Centrica and O2. Pendragon CEO and interim chairman Bill Berman said her “extensive track record and considerable experience across a range of sectors will provide significant insight as we continue our transformation”.
Motorpoint shareholder builds stake
Immersion Capital LLP, a UK hedge fund registered in Hertford, last week increased its stake in Motorpoint from 17% to 19.67%. It now holds 17.74 million shares. The used car retailer’s next-largest shareholder is Standard Life Investments Ltd, with a 10.79% holding. In September last year, co-founder David Shelton sold a total of 13.39m shares in a £27m deal.
WORLD NEWS
New car sales banned in Italy
A two-week quarantine in Italy means retailers are no longer officially permitted to sell cars. Lawyers have advised Italians that if their current vehicle is running properly, they should postpone their purchase. Autotorino, which sold 29,100 new and 22,400 used cars last year, has closed for the first time in its 55-year history. Servicing is, however, a grey area: some retailers are choosing to work only on ambulances, or vehicles owned by doctors, nurses or the elderly.
Retailers key to GM’s EV plans
GM president Mark Reuss has described its US dealer network as “a huge competitive advantage” in its $20bn investment in electric vehicles. The automaker believes its dealer body will be key to achieving its lofty scale targets. GM has also established a 16-member EV dealer advisory board to investigate the effect electric vehicles will have on dealer operations. Despite worries about EVs’ reduced service and maintenance requirements, GM CEO Mary Barra is positive: “Just think of the complexities: there are hundreds of billions of lines of code… I think there are opportunities.”
STOCKWATCH
Closing prices on 13 March 2020 and weekly change
Lookers plunges 43.8% after delayed results and Cameron Wade’s departure
Auto Trader Group 447.6p (-47.8p / -9.6%)
Cambria 54.0p (-11.0p / -16.9%)
Caffyns 335.0p (-65.0p / -16.25%)
Halfords 103.0p (-28.6p / -21.7%)
Inchcape 536.0p (-47.5p / -8.1%)
Lookers 20.15p (-15.75p / -43.8%)
Marshall Motor Holdings 132.5p (-18.5p / -12.25%)
Motorpoint 251.0p (-44.0p / -14.9%)
Pendragon 7.44p (-4.4p / -37.1%)Vertu 23.9p (-6.5p / -23.9%)
LAUNCH DIARY
BMW 2 Series Gran Coupe, four-door coupe derived from the 1 Series, offered as 140hp 218i, 306hp M235i xDrive and 190hp 220d, in retailers now from £25,815
Vauxhall Corsa-e, electric Corsa has a 50kW battery and a 209-mile range, priced from £28,165 including the (revised down to £3,000) Plug-in Car Grant, early customers get a free Pod Point wall box
Czinger 21C, 1,250hp hypercar launched in London last week, will do 0-62mph in 1.9 seconds, limited to 80 units all hand-built in LA, California
COMING UP
Wednesday, Pendragon annual results
Wednesday, Chancellor Rishi Sunak at Treasury Select Committee
Friday, Auto Retail Live Profit Briefing: optimising opportunities in a turbulent climate
MONEY MATTERS
Recession fears grow
Economists are warning the UK economy could tip into recession in 2020, the first since 2009. Several have forecast a 0.7% full-year decline in UK GDP, and a 1% fall in Eurozone GDP. Paul Dales of Capital Economics told The Sunday Times he fears a 2.5% decline in Q2 GDP. A big hit is coming.”
There is also growing speculation the Bank of England could respond by cutting interest rates further, to 0.1%, their lowest ever level. Major retailers are preparing to request the Treasury defers all business rates.
Aston Martin rescue deal revised
Aston Martin has announced revised terms of a rescue deal by a consortium led by Canadian Lawrence Stroll. The company will now raise £536m in a rights issue, rather than £500m, and Mr Stroll will put in less money for a larger 25% stake. Mr Stroll will also raise a short-term loan by £20m, to £75.5m, to ease company finances. An EGM to agree the rights issue, originally planned today (Monday 16 March) has been rescheduled for 30 March.
BLOG: What a week for Lookers
BLOG EXTRA: Coronavirus planning
Tags:
Aston Martin, Cazoo, Coronavirus, Covid-19, GM, Lookers, Motorpoint, OLEV, Pendragon, Plug in car grant 
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