Auto Retail Agenda: 17 April 2023
15 April 2023
- SUZUKI NETWORK ON TRACK TO HIT 3, 2, 1 TARGET
- NETWORK REPORT REVEALS RETAILER RETURN ON SALES
- MOTORVOGUE PROFIT JUMPS
- PAUL HENDY TO DISCUSS USED CAR KPIS
- CAPITA HACK CRISIS DEEPENS
- CARMAX SEEKS PROFIT OVER VOLUME
- INCHCAPE APPOINTED BY TATA IN THAILAND
- STOCKWATCH
- COMING UP: CPI, unemployment
- OVER-CAUTIOUS PENSION FUNDS ARE COSTING RETIREES
- PRIVATE EQUITY TARGETS FTSE 250 BARGAINS
Suzuki network on track to hit 3, 2, 1 target
Suzuki’s network average return on sales is currently at 2.3% according to UK managing director Dale Wyatt.
The figure puts the brand on track to meet its 3, 2, 1 plan which aims to have an RoS figure of 3%, a market share of 2% and a first place for brand trust by the end of this year.
First revealed in sister publication Auto Retail Bulletin last year under the motto ‘Together Toward Tomorrow’, Wyatt told Auto Retail Agenda that Suzuki was already the leading automotive brand for trust. He added that while its market share for the first quarter of 2023 was at 1.4% he expected to be at 2% for the second half of the year.
Commenting on the recent ZEV mandate consultation that could require UK OEMs to hit a 22% fully-electric sales mix for 2024, Wyatt said Suzuki’s first BEV was some 18 months away and that he was still working out how to tackle the issue with options including borrowing from future sales, buying credits or bringing forward supply.
Network Report reveals retailer return on sales
New return on sales data revealed in the latest Auto Retail Networks Report 2023, previously called the Franchising Report, has shown a 2022 average of 2.0% down from 2021’s record of 2.3%.
The figures illustrate each OEM’s rolling average and its ups and downs – and show returns are still strong, particularly amongst German brands.
The report also contains invaluable data on how return on sales has changed over a 10-year period, and gives an average figure for each OEM over the past decade.
- Networks Report 2023, a comprehensive guide to carmakers and their retail networks, is available to buy now: https://bit.ly/3GJh20w
Motorvogue profit jumps
Motorvogue saw profit before tax grow from £413k to £892k in the year ended June 2022. Turnover at the Northamptonshire retailer grew from £69.5m to £89.7m. It said the Stellantis merger “had a significant impact on our Fiat, Jeep and Alfa Romeo profitability”.
Paul Hendy to discuss used car KPIs
Hendy Group CEO Paul Hendy will join the latest Auto Retail Live broadcast on 27 April on used car KPIs. Auto Trader’s Marc Thornborough and RealTime Communications’ John Law will also offer their views on the Q1 used car performance – and future trends.
Guests will discuss the outlook for used car values, why there’s instability in the EV market and what’s likely to happen to diesel values. They will also answer retailer questions live on the day.
Sign up for the free 40-minute webinar here: https://bit.ly/3L41MOw
Capita hack crisis deepens
A cyberattack on outsourcing company Capita by Russian criminals is reportedly more serious than the company has admitted. Personal information including bank details, addresses and passport photos are being leaked online. Capita admitted the hack by the Black Basta group earlier in April but insisted people’s personal details remained secure.
WORLD NEWS
CarMax seeks profit over volume
CarMax, the largest used car retailer in the US, is prioritising profit per vehicle instead of overall sales, in a quarter where volumes fell 13% but profit profit per vehicle remained steady at $2,277 (£1,832). “We could have sold a few more cars, but we actually would have made less money,” said CEO Bill Nash.
An analyst for equity research group Stephens Inc said running price sensitivity tests helped CarMax conclude it was better to sell at a higher price than issue discounts in the hope of closing more sales. CarMax is also seeking to cut costs and better align marketing spend to sales.
Inchcape appointed by Tata in Thailand
Tata Motors has appointed Inchcape as the distributor of its commercial vehicles in Thailand. “This is a great example of our Accelerate strategy in action,” said Inchcape APAC CEO Ruslan Kinebas, “delivering on the group’s ambition to expand its existing global footprint and being the automotive distributor of choice.”
STOCKWATCH
Closing prices on 14 April 2023 and weekly change
Auto Trader Group 620.0p (+21.2p / +3.4%)
Caffyns 550.0p (+25.0p / +4.6%)
Halfords 174.0p (+6.6p / +3.8%)
Inchcape 766.0p (+17.5p / +2.3%)
Lookers 88.5p (+0.9p / +1.0%)
Motorpoint 133.5p (-1.25p / -0.9%)
Pendragon 17.1p (+0.1p / +0.5%)
Vertu 61.5p (+0.9p / +1.4%)
COMING UP
Tuesday, UK unemployment
Wednesday, CPI
Friday, retail sales
Friday, GFK consumer confidence
April 27, Auto Retail Live: sign up now
May 3, Radius Law annual conference: sign up now
MONEY MATTERS
Over-cautious pension funds are costing retirees
Retirees are losing out on thousands of pounds because pension funds are not taking enough risk and ignoring British investment opportunities. Pension schemes are avoiding British infrastructure projects such as railways and housing because of preconceived notions around higher costs and poor liquidity.
Britain has the fourth largest pensions market in the world, worth £1.6 trillion – but businesses and infrastructure projects often fall into the hands of foreign pension funds.
Private equity targets FTSE 250 bargains
Private equity is reportedly targeting more FTSE 250 companies amid a view there are bargains to be had in the UK. “The more people bash the UK, the more tempting it is to believe it is screamingly cheap,” said one analyst. Private equity groups reportedly have tens of billions of dollars looking for a home – known as ‘dry powder’ in industry-speak.
Tags:
Capita, CarMax, CPI, Dale Wyatt, FTSE 250, Hendy Group, Inchcape, Motorvogue, Network Report, Paul Hendy, pensions, return on sales, Suzuki 
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