18 November 2018

 

• VAUXHALL AIMS TO REGAIN SECOND PLACE
• VOLATILE 2019 PREDICTED FOR CAR SALES 
• COMPANY CARS FACE HIGHER TAX COSTS
• TESLA IN PROFIT AS UK SALES ALMOST DOUBLE
• FORD TRANSIT OUTSELLS MOST CARS
• WORLD NEWS –  Chinese car market faces sales crash
• STOCKWATCH – Marshall continues to climb
• COMING UP – Cambria results, Finance & Leasing Association Annual Motor Finance Convention, Caffyns half-year results
• LAUNCH DIARY – Range Rover Evoque, Vauxhall Crossland X Ultimate, Renault Master E.V. LCV
• MONEY MATTERS –  Inflation remains steady above BoE target
• OUR BLOG – is the trade pushing used AFVs hard enough?

 

Vauxhall aims to regain second place

Vauxhall boss Stephen Norman is aiming to retake second place in the UK new car market in the next three years.

Speaking exclusively to sister publication Auto Retail Bulletin, Mr Norman said that not only was he aiming to grow market share, but also to make sure that lead over the third-placed brand was not easily retaken.

Since 2015 Vauxhall has seen its market share drop from 10.2% and second place in the market to the current 7.4% and third place, with Volkswagen overtaking it earlier this year.  Mr Norman said he would achieve this while also re-aligning vehicle pricing so that it sits as a rival to VW.  He added that the new Corsa, due out late next year, would be “priced on the nose with the Polo”.

The Vauxhall boss, who earlier this year started reorganising the brand’s retail network with a cut of 69 sales locations, said he was also aiming to lift retailer profitability.  The Vauxhall network started the year with an average return on sales of 0.4%, however this is already at 0.8%, according to Mr Norman.  He added that he expects this to rise further but would not be drawn on a defined aim.

*Read the full interview with Vauxhall’s Stephen Norman in the December issue of Auto Retail Bulletin, in which he answers questions raised by the retail network.

 

Volatile 2019 predicted for car sales 

Car sales in the UK are in for a volatile 2019, even if a business-friendly deal is struck for the UK to leave the EU, according to speakers at the Auto Retail Network Economic Forum held on Friday.

Alongside uncertainty over a Brexit deal, speakers cited a lack of direction from the Government surrounding fuel-type taxation and economic factors such as a possible rise in interest rates as factors that could push new car sales either up or down next year. At the event, held in partnership with PwC, Auto Trader and Santander, several speakers also highlighted the fluctuating exchange rate due to the on-off nature of the Brexit negotiations as another reason for uncertainty in the new car market in 2019.

 

Company cars face higher tax costs

Company cars and vans face being more expensive under government plans and despite its previous assurances. The Finance Bill contained proposals to let HMRC tax elements such as replacement tyres, breakdown cover, insurance and maintenance schemes as well as the vehicle’s value. Staff on company car salary sacrifice schemes could pay more tax and employers could see an increase in Class 1A National Insurance.

Next spring the government will complete its review into company car tax in the wake of WLTP.

https://bit.ly/2yZAz9Y

 

Tesla in profit as UK sales almost double

Tesla turned a loss of more than £150,000 in 2016 into a profit of more than £800,000 last year as it almost doubled sales of its two EV models.

Tesla Motor Ltd delivered 4,485 cars in the UK in 2017, against 2,504 in 2016. Revenues jumped 88% to £237 million from £126m but gross profit margin was down, at 24% compared to 35% in 2016.

It currently sells the Model S and Model X from 19 Tesla Stores in England and Scotland and is expecting a significant boost when the Model 3 arrives next year. The company has still to confirm its UK pricing or on-sale date.

 

Ford Transit Custom outsells most cars

Ford’s Transit Custom van is the third best selling new vehicle overall this year, behind only the Ford Fiesta and VW Golf, with more than 52,000 registrations.

Sales of white Transit Custom are dropping as more people opt for silver and grey and the new-for-2018 Orange Glow.

https://bit.ly/2yYzf7C

 

 

WORLD NEWS

Chinese car market faces sales crash

China’s car sales plunged 12% in October to 2.4 million, stoking fears the world’s biggest car market could see the worst annual fall since 1990. The China Association of Automobile Manufacturers (CAAM) said overall vehicle sales for January-October totalled 22.9m. October was the fourth straight month of declines and the steepest drop since early 2012. Sales of EVs and PHEVs remained strong, up 51 percent in October, and by 76% year on year, at 860,000.

https://reut.rs/2FtbVnZ

 

National Grid to plug into USA EV market

National Grid, which runs the UK power distribution network, has filed a request with the Massachusetts Department of Public Utilities to allow it to invest £130 million over five years to provide 17,000 electric vehicle charging points across the state.

 

STOCKWATCH

Closing prices at November 16 and weekly movement

BCA 214.0p (+1.0p)

Cambria 53.0p (+1.0p)

Caffyns 405.0p (n/c)

Inchcape 557.5p (-27.5p)

Lookers 93.5p (-5.2p)

Marshall Motor Holdings 156.0p (+14.0p)

Motorpoint 219.0p (+2.0p)

Pendragon 24.6p (-1.7p)

Vertu 38.0p (+0.5p)

 

COMING UP

Wednesday. Cambria Automobiles plc preliminary results for the year to August 31

Thursday. Finance & Leasing Association Annual Motor Finance Convention, Williams F1 Conference Centre, Oxon.

Friday. Caffyns’ half-year results

27^th. Society of Motor Manufacturers and Traders’ Annual Dinner, London.

December: Tuesday 11^th.  Auto Retail Profit Briefing webcast. 30 minutes with Peter Vardy, managing director, Peter Vardy retail group, and Stuart Miles, CDK’s UK general manager, discussing strategies to increase sales and profits.

To register https://bit.ly/2PY8DgC

 

LAUNCH DIARY

Thursday: Range Rover Evoque, from approx. £35,000.

Vauxhall Crossland X Ultimate. Range topping SUV.  From £22,480.

Renault Master Z.E LCV. 74 mile range, full recharge in 6 hours. From £45,700 ex. VAT and after PiVG.

2019.

July: BMW 330e PHEV. Electric range of 37 miles. Prices tbc.

 

MONEY MATTERS

Inflation remains steady above BoE target

Inflation remained steady at 2.4% in October, confounding analyst expectations of a rise to 2.5%, but still above the bank of England’s 2.0% target.

The Consumer Prices Index (CPI) figure included falls in food and clothing costs but covered rising utility bills and petrol prices, said the ONS.

 

Average house prices up £8,000

Average house prices increased by 3.5 per cent in the year to September to stand at £233,000, a rise of £8,000, according to the latest ONS House Price Index.

The West and East Midlands saw the highest annual regional growth, both up by 6%. London has the highest average (£482,000).

 

OUR BLOG

Does the trade push used EVs properly?

Is the trade missing something of a trick in the way it pushes and promotes second-hand hybrids and EVs?

We can all see which way the wind is blowing. In Q3 demand for used plug-ins, hybrids and pure EVs rose almost 30% and although the numbers overall are small in the scale of the total industry volume, not quite 30,000 set against 2 million, this figure will surely only grow. At the time of writing (Sunday) Auto Trader listed about 470,000 used petrols and diesels and only 9,500 AFVs but that is still a respectable figure and a good opportunity for business in a growing sector.

Given the way the market is now, and will probably head next year, isn’t that something to build on? AFVs will only get better in price and practicality and in doing so become ever more appealing to the retail buyer, not just the company car driver concerned about tax but Mr and Mrs Average who might well buy petrol/diesel now but who have seen the headlines about hybrids and are interested enough to be asking if they fit into their budget and lifestyle.

At the very least it’s a solid foundation and apocryphal stories from the showrooms indicate that interest is building even if in many cases not yet quite at that tipping point where people choose an AFV. Price is the main hurdle but that will change.

So why doesn’t the trade push them harder?

A quick trawl of supermarkets or even the franchises reveals that you have to drill down a few layers from their website’s landing page to find the first reference to them, usually when choosing fuel type. But it’s hardly a ringing endorsement of these cars or a reflection of the growing interest in them, is it.

Apologies if I’ve missed them but I am not aware of any specialist used AFV independents either. There are for 4x4s, for certain marques, for sportscars but not yet for AFVs.

The warranties might be an issue, as is getting stock, but if someone is interested enough to pick up the phone, to visit the forecourt or even Google `used hybrid’ than that’s halfway to a sale and yet the trade seems oddly Ill-prepared to take advantage of that.

 

John Swift

Editor

Auto Retail Network