Auto Retail Agenda: 18 May 2020
17 May 2020
- INDUSTRY REPORTS GREEN SHOOTS
- £1.3bn CARGIANT LEADS AUTO RETAIL RICH LIST
- BLACKROCK DECREASES INCHCAPE INVESTMENT
- CLELAND GOES VIRAL WITH COVID-FRIENDLY HANDOVER DEMO
- VOLVO SUBSCRIPTION VIOLATES STATE LAWS
- IRISH CAR SHOWROOMS REOPEN TODAY
- STOCKWATCH – Lookers down 26.5%
- COMING UP – UK unemployment, Marshall AGM
- FURLOUGH HOLIDAY PAY CLARITY
- FCA COMPLIANCE VITAL DESPITE COVID-19
- BLOG: Judging when to reopen the dealership
Industry reports green shoots
Auto retail executives and sales platforms are reporting a rise in activity and vehicle sales following PM Boris Johnson’s confirmation showrooms should be able to reopen from 1 June.
Vertu’s Robert Forrester said last Friday’s retail orders were “well over 100… best since lockdown started”. He confirmed very strong demand in LCVs too.
Marshall’s Daksh Gupta said the group is working on “Project Reactivation” and is readying dealerships to welcome customers: reopening dates will be confirmed soon.
Vines Group confirmed that from 13 May it has been facilitating online sales of vehicles via email and phone, for contactless ‘click and collect’ handover.
Auto Trader is launching contactless collection tools on 20 May as part of its Retail Ready initiative: more than 2,500 retailers have already begun to upload details of their measures (the service is free). Last week it reported the biggest audience since lockdown began, with a peak of well over 1 million daily visits: that’s week-on-week growth of 15%, while vehicles saved per day is actually up 58% year-on-year.
CAP HPI said data volumes in early May rose 70% compared to two weeks earlier – and head of valuations Derren Martin announced adjustments to used car values have recommenced after being frozen during lockdown due to insufficient data.
£1.3bn Cargiant leads auto retail Rich List
Cargiant founder Geoffrey Warren is the leading auto retail name on the 2020 Sunday Times Rich List with a wealth of £1.3bn. He is placed 111th in the list and achieves billionaire status in 2020; his 2019 wealth listing was £500m. Arnold Clark’s Lady Philomena Clark and family are 134th at £1.13bn, IM Group’s Lord Edmiston is at 141 on £1.05bn, JCT600’s Jack Tordoff and family are 349th with £376m and Robert Marshall and family are placed 395th at £331m.
Blackrock decreases Inchcape investment
Blackrock Inc has decreased its stake in Inchcape from 5.02% to below 5% (meaning it now doesn’t have to file US SEC stock ownership report forms). Inchcape is due to publish its next trading update on 21 May, after cancelling its share buyback scheme in March and scrapping its dividend in April. Also in April, BlackRock increased its stake in Auto Trader to 9.74%.
Cleland goes viral with Covid-friendly handover demo
Clelands Volvo owner John Cleland has filmed a video explaining how the Galashiels retailer handles deliveries during Covid-19. Cars are sanitised and placed in a quarantine area 72 hours before handover and, on delivery, the customer get into their new car and a salesperson sits in a similar-specification vehicle for a talk-through of controls via telephone before departure. Even keys are sanitised and presented in a sealed bag. Nearly 8,000 people have watched the video so far.
WORLD NEWS
Volvo subscription violates state laws
A six-month investigation by the California Department of Motor Vehicles has concluded Volvo Cars USA’s vehicle subscription programme violates several franchise and consumer protection laws. The petition was filed by the California New Car Dealers Association in January 2019, which called Care by Volvo “illegal”. Volvo said it “respectfully disagrees with the conclusions”. The California New Motor Vehicle Board will review the report on July 10.
Irish car showrooms reopen today
Retail showrooms in Ireland have been cleared to reopen today (Monday, 18 May) provided they meet government requirements for social distancing. The Society of the Motor Industry initially thought auto retailers could not open until Ireland’s second phase on 8 June. The clarification came late last week and gives retailers an extra three weeks to prepare for the second registration period starting in July.
STOCKWATCH
Closing prices on 14 May 2020 and weekly change
Lookers down 26.5%
Auto Trader Group 502.0p (+22.2p / +4.6%)
Cambria 45.5p (-0.5p / -1.0%)
Caffyns 280.0p (n/c)
Halfords 166.0p (+14.6p / +9.6%)
Inchcape 468.6p (-23.0p / -4.6%)
Lookers 18.1p (-6.55p / -26.5%)
Marshall Motor Holdings 103.5p (+5.5p / +5.6%)
Motorpoint 198.0p (+8.0p / +4.2%)
Pendragon7.11p (-0.49p / -6.4%)
Vertu 25.0p (-0.7p / -2.7%)
COMING UP
Tuesday, UK unemployment
Wednesday, RPI, CPI
Thursday, Marshall AGM
MONEY MATTERS
Furlough holiday pay clarity
Furloughed workers continue to accrue annual leave and they can take holiday without ending furlough, the government has confirmed. Holiday pay should be the standard rate, not the 80% furlough rate, and examples of where it would be ‘not reasonably practical’ to take annual leave have been outlined. The NFDA adds that questions still remain over furlough and holiday pay.
FCA compliance vital despite Covid-19
Auto retailers should ensure they are still complying with FCA guidelines in the light of new regulations due to coronavirus. Changes include digital signatures and more online meetings to verify income. Complyport CEO Paul Grainger warns the loss of face-to-face meetings underlines the importance of virtual meetings and agreements being fully FCA compliant.
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