Auto Retail Agenda: 14 June 2021
13 June 2021
- BREARLEY TAKES LAWYERS TO COURT OVER JLR SITE ADVICE
- VERTU ‘RISKS INVESTOR BACKLASH’
- COUNCIL BUYS PENDRAGON STRATSTONE PREMISES
- SYTNER TO TURN CINEMA INTO CARSHOP
- MORE THAN HALF BACK ‘FREEDOM DAY’ DELAY
- DAIMLER TO DISPOSE OF EU SHOWROOMS
- VOLKSWAGEN GROUP IN DATA BREACH
- STOCKWATCH – Auto trader up 10% after “solid” full-year results; net debt position of £282m forecast to become £10m surplus by year-end
- COMING UP – Halfords full year
- ECONOMY NEARS PRE-PANDEMIC LEVELS
- FREEDOM DAY DELAY TO COST ECONOMY £55m A DAY
- BLOG: Agency agreement information underload
Brearley takes lawyers to court over JLR site advice
James Brearley, Pendragon’s former Stratstone managing director and now Inchcape Retail CEO, is suing his former legal team Higgs and Sons.
Brearley and three others are alleging professional negligence over advice surrounding his attempt to set up a JLR dealership in Wolverhampton following his departure from Pendragon in 2015.
The case, which started last week in the High Court, is expected to run for six weeks. Opening statements were heard from each side on Friday with witnesses expected to appear this week.
Mr Brearley’s plans to open an Arch concept Jaguar Land Rover dealership were stopped following legal action by Pendragon in 2016. Pendragon previously operated the franchise in Wolverhampton.
Mr Brearley’s JRB Automotive eventually sold the site for the showroom site to Jardine Motors later in 2016.
Vertu ‘risks investor backlash’
Vertu could face a “revolt” at its AGM on 23 June over a £200k bonus for chief executive Robert Forrester. Vertu claimed £27.8m in furlough during the pandemic and received £8.7m in business rates relief. Last month, a bonus for Pendragon CEO Bill Berman was condemned at its AGM, although the motion was passed by shareholders.
In response, Vertu said directors initially waved their entitlement to a bonus. However, the renumeration committee, after “engaging directly with several of the largest shareholders”, decided to award reduced bonuses after “significant progress” by the firm.
Council buys Pendragon Stratstone premises
Pendragon’s Stratstone Jaguar and Land Rover Stockton dealership is among £44m of commercial properties acquired Somerset West and Taunton Council. The Pendragon deal is worth £6.13m. The council is investing to create a commercial property portfolio that will offset falling central government grants. Its latest £44m deal will provide annual rental income of £3.25m a year.
Sytner to turn cinema into CarShop
Sytner has applied to demolish a former Showcase cinema and surrounding restaurant buildings in Derby. The retailer wants to build a new CarShop outlet at the Foresters Park Centre, creating 65 new jobs. CarShop has already invested in Nottingham, creating 75 jobs at a seven-acre site displaying over 900 vehicles.
More than half back ‘freedom day’ delay
54% of UK adults believe the lifting of Covid-19 restrictions should be postponed, up from 43% two weeks ago. Just 37% think they should go ahead as planned. Restrictions are currently planned to lift on 21 June, but the date is likely to be postponed, possibly to the middle of July. One government adviser said a delay to lifting lockdown is now “inevitable”.
WORLD NEWS
Daimler confirms EU showroom sell-off
Daimler is looking to dispose of 25 showrooms and service sites across Europe to reduce fixed costs, reports Handelsblatt. The sale could raise up to €1bn. Daimler-owned retail branches in the UK, Spain and Belgium will be sold to independents, raising €30m-€40m per branch.
In February, Mercedes-Benz Retail Group posted a £35.8m loss for the year ended December 2019, up from a 2018 loss of £21.2m.
Volkswagen Group in data breach
Volkswagen Group retailers in America have been warned a vendor, Shift Digital, has been involved in a data breach affecting more than 3.3 million customers and prospective buyers. The Audi brand is primarily affected. Free credit protection will be offered to 90k individuals from whom particularly sensitive data was accessed.
STOCKWATCH
Closing prices on 11 June 2021 and weekly change
Auto trader up 10% after “solid” full-year results; net debt position of £282m forecast to become £10m surplus by year-end
Auto Trader Group 621.0p (+63.2p / +10.7%)
Cambria 81.0p (-2.0p / -2.4%)
Caffyns 420.0p (n/a)
Halfords 395.0p (+23.0p / +4.1%)
Inchcape 769.5p (-11.0p / -1.4%)
Lookers 66.7p (-2.2p / -3.2%)
Marshall Motor Holdings 191.0p (+4.5p / +2.3%)
Motorpoint 275.0p (-6.0p / -2.1%)
Pendragon 18.5p (n/c)
Vertu 45.4p (-0.6p / -1.3%)
COMING UP
Tuesday, unemployment figures
Wednesday, CPI and RPI
Thursday, Halfords finals
Friday, retail sales figures
MONEY MATTERS
Economy nears pre-pandemic levels
The economy has recovered almost all ground lost due to the coronavirus pandemic, aided by 2.3% growth in April alone. GDP is only 3.7% below February 2020 and the economy is now 1.2% bigger than October 2020, the previous post-pandemic high. It is forecast the economy will pass pre-pandemic levels before Christmas.
Freedom day delay to cost economy £55m a day
The economy will suffer a £55m daily hit if the final stage of Covid-19 reopening is delayed by four weeks. Hospitality will suffer the worst of the £1.6bn hit. “The longer restrictions are required,” said Kay Neufield from the Centre for Economics and Business Research (CEBR), “the higher the risk of an insolvency wave later in the year.”
BLOG: Agency agreement information underload
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