Auto Retail Agenda: 14 March 2022
12 March 2022
- GOOGLE LAUNCHES AUTOMATED CAR ADS
- WAITING BUYERS WANT MORE FROM RETAILERS
- JOHNSONS IN ANOTHER TAKEOVER
- AGENCY CONVERSION RATES ‘BETTER THAN FRANCHISE’
- ORDERING OPEN FOR 2022 FRANCHISING REPORT
- FORD OF EUROPE IS NO MORE
- NADA LAUNCHES ONLINE EV TRAINING
- AUTO1 STRIKES 10k-A-YEAR CAR SUPPLY DEAL
- STOCKWATCH: Lookers falls 10%
- COMING UP: Auto Retail Live Q1 briefing, Bank of England interest rate decision
- INTEREST RATE RISE FORECAST
- RUSSIAN GOVERNMENT TO SEIZE FOREIGN ASSETS
Google launches automated car ads
Google will this month roll out automated vehicle ads to all US advertisers. Vehicles will appear in Google search, in a dedicated ads section at the top of the search page, for queries such as “2019 SUVs for sale”. The vehicle ads will launch to advertisers in other countries at an “undisclosed later date”.
Retailers who have created a vehicle inventory data feed, and connected it to the Google Merchant Centre, will be able to promote their entire inventory to customer on google.com. The format includes an image, vehicle make, model, price and mileage, and the advertiser’s name.
In beta testing, Google said advertisers who used vehicle ads saw an average 25% increase in conversions.
Asbury Automotive was one of the beta retailers and saw a 35% increase in conversions, and a 12% increase in conversion value. “With vehicle ads, we can help customers by bringing them right to the car they’re interested in,” it said in a statement. “The results from the pilot far exceeded our expectations.”
Waiting buyers want more from retailers
Although customers have become more willing to wait for a new vehicle, retailers could be better about keeping them informed about the delivery process and timeline. In a survey, 20% didn’t get updates from their retailer about order status – and 60% want more text and online communications.
1 in 3 new car buyers also didn’t get their first vehicle choice.
Last week, Ford warned US retailers they will not receive any new vehicle allocations until May. The company has lost 100k units of production due to failures from suppliers. 2022 production is predicted to fall 12%.
Johnsons in another takeover
Johnsons Cars has taken over Autosales Suzuki in Bilston and Cannock. The retailer says it is one of the largest independent dealership groups in the UK, and one of the largest Volkswagen retailers, with more than 60 branches. Last week, Johnsons acquired Trust Group UK.
Agency conversion rates ‘better than franchise’
Polestar UK CEO Jonathan Goodman claims agency model conversion rates are as high as 13%, compared to 10% for a franchised model. This is despite Polestar being a new and unknown brand. “We’re looking to increase that rate moving forward.”
Although Lookers COO Duncan McPhee said he hadn’t noticed such a marked change, “we have seen an uplift on consumers taking finance online. That conversion has definitely improved”.
Ordering open for 2022 Franchising Report
The latest Auto Retail Network Franchising Report reveals the latest on agency agreements and the impact of new car registrations drop on aftersales vehicle parc. The only complete guide to the structure and sales performance e of franchised auto retail networks in the UK, ordering is open now.
The 2022 report also includes a new section of all the brands’ plans so far on the move from franchised to agency agreements.
WORLD NEWS
Ford of Europe is no more
Ford of Europe will no longer be a separate entity within the Blue Oval from 2023. Ford is instead splitting into five global divisions: Ford Blue (for combustion engine vehicles), Model e (for EVs), Ford Pro (for CVs), Ford Drive (formerly Ford Mobility) and Ford Credit. As a result, regional earnings will no longer be broken out.
Ford of Europe was created in 1967 with the merger of Ford of Britain, Ford Germany and Ford Ireland.
NADA launches online EV training
NADA has launched an online training program for franchised retailers. It has been designed to complement model-specific training and help sales representatives “remove any fear, uncertainty or doubt about owning an EV”. Those who complete the course will receive certification.
Auto1 strikes 10k-a-year car supply deal
European online retailer Auto1 has struck a deal with Allane Mobility (formerly Sixt Leasing) to sell 10,000 returned lease and fleet vehicles a year. Retailers will be able to access weekly auctions of around 250-300 cars.
Autohero, the consumer retail arm of Auto1, was Europe’s fastest-growing digital brand in 2021.
STOCKWATCH
Closing prices on 11 March 2022 and weekly change
Lookers falls 10%
Auto Trader Group 643.8p (+17.6p / +2.7%)
Caffyns 550.0p (n/c)
Halfords 243.4p (+9.6p / +4.0%)
Inchcape 678.5p (+27.0p / +4.0%)
Lookers 76.3p (-8.1p / -10.0%)
Marshall Motor Holdings 396.0p (+2.0p / +0.5%)
Motorpoint 282.0p (-14.0p / -4.8%)
Pendragon 21.1p (+0.4 / +1.9%)
Vertu 57.2p (-0.8p / -1.3%)
COMING UP
Monday, Ford of Europe chair Stuart Rowley “presents key business updates and further steps towards an all-electric future” at 0830am
Tuesday, Auto Retail Live Q1 Briefing. Sign up here
Wednesday, $117m interest payments on two Russian bonds due
Wednesday, CPI and RPI
Thursday, Bank of England interest rate decision
Friday, GFK Consumer Confidence
23 March, Spring statement ‘mini-budget’
MONEY MATTERS
Interest rate rise forecast
The Bank of England is this week expected to raise interest rates in response to inflationary pressures. The MPC is predicted to vote for a raise from 0.5% to 0.75%. The Ukraine war is adding to inflation with some economists taking of a peak close to 10% later this year.
Russian government to seize foreign assets
The Russian government is moving to seize foreign-owned assets due to the economic collapse caused by the invasion of Ukraine. It has approved a bill to nationalise assets from corporations more than 25% foreign-owned. Mercedes-Benz this week confirmed its operations were at risk and $2.2bn in assets held by its Russian operations could be “expropriated”.
Tags:
agency model, Auto1, Autosales, Bank of England, Ford, Franchising report, google, interest rates, Johnsons, Lookers, NADA, Polestar, Russia, search, Ukraine 
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