Auto Retail Agenda: 20 December 2021
19 December 2021
- PEUGEOT BOSS REVEALS MEAGRE ONLINE SALES
- NIKE DIRECT SALES WARNING
- JAMIE PRIESTLEY IS TOP VERTU MANAGER
- RECAP: MERCEDES CONFIRMS AGENCY
- US RETAILER BUY-SELL FRENZY TO CONTINUE IN 2022
- NEW HEAD OF MINI
- STOCKWATCH – Cambria delisted
- COMING UP: UK GDP
- EMERGENCY BAILOUT FOR BUSINESSES MOOTED
- 1 IN 4 COMPANY AUDITS FALL SHORT
- ‘MORE INTEREST RATES TO COME’ SAYS BoE ECONOMIST
Peugeot boss reveals meagre online sales uptake
Although 90% of Peugeot customers start the buying process on the internet, the percentage of those who buy entirely online is “well below 5%” Peugeot boss Linda Jackson has revealed.
“In the future there will be some who want to buy online all the way… but we need to understand how to adapt the process if they want to touch and feel – what we call a ‘phygital’ experience, a combination of physical and digital.”
Peugeot also needs to “completely restructure our distribution network”, said Ms Jackson. “You don’t do that overnight.”
Ms Jackson said Peugeot is now the volume brand benchmark for pricing power thanks to a decade of work on increasing pricing power. Peugeot was 2.4% below the pricing benchmark in 2015; today, it is 1.5% above.
Nike direct sales warning
Nike is aiming to cut the number of chains it supplies to only 40 worldwide as part of its Consumer Direct Offensive initiative. Several leading UK retailers, such as Very Group and Schuh, have recently been dumped by Nike and it cut ties with John Lewis in 2019.
The direct-to-consumer movement is causing consternation amongst retailers; one senior figure called it the biggest change the industry has seen in at least 20 years. “All sports brands are looking at ways of going direct,” added advisor Paul Sherratt. “They make more margin, they know who the customers are and they can build a community.”
However, one national chain has submitted a formal complaint to the Competition & Markets Authority over Nike’s cull. “It has a serious negative effect on competition and consumer choice… it appears to be backdoor price maintenance.” The CMA has yet to rule if there is a case.
Jamie Priestley is top Vertu manager
Bristol Street Motors Halifax Nissan boss Jamie Priestley has been named Vertu Motors General Manager of the Year. Mr Priestley beat eight other finalists. Robert Forrester said he has “shown outstanding leadership and commercial skills… with a keen focus on exceptional customer service and encouraging superb teamwork from all of his colleagues”.
Recap: Mercedes confirms agency model for 2023
Last Friday, Auto Retail Agenda broke the news UK Mercedes-Benz retailers will switch to an agency agreement in 2023. Read our story here – which includes a warning on agency agreements from NFDA chief executive Sue Robinson.
WORLD NEWS
US retailer buy-sell frenzy to continue in 2022
2021 will be a record year for auto retailer transactions in the US and more of the same is expected in 2022. More than 350 transactions are expected in 2021. The average ‘blue-sky’ value of retailers, which includes goodwill, has also reached record highs of around $10m (£7.5m) per retailer. A combination of high retailer profits and public companies eager to grow is driving the trend.
New head of Mini
Stefanie Wurst has been appointed head of the Mini brand. She takes over from Bernd Koerber, who becomes head of BMW product management. The Mini job is said to be a stepping stone for BMW Group executives on the way to top positions. Ms Wurst, currently head of BMW Group in the Netherlands, takes up the role in February 2022.
STOCKWATCH
Closing prices on 17 December 2021 and weekly change
Cambria delisted
Auto Trader Group 718.6p (-15.2p / -2.0%)
Caffyns 525.0p (n/c)
Cambria 82.5p (n/c)
Halfords 330.4p (-27.6p / -8.0%)
Inchcape 857.5p (-7.5p / -0.8%)
Lookers 63.6p (-1.4p / -2.1%)
Marshall Motor Holdings 393.0p (+1.0p / +0.2%)
Motorpoint 319.0p (-19.0p / -5.7%)
Pendragon 21.8p (-0.2p / -0.9%)
Vertu 65.2p (-5.0p / -7.3%)
COMING UP
Tuesday, public sector net borrowing
Wednesday, UK GDP
Friday, Christmas Eve
MONEY MATTERS
Emergency bailout for businesses mooted
Chancellor Rishi Sunak is understood to have held emergency talks with the PM over the weekend to finalise a rescue scheme for businesses under pressure from omicron Covid cancellations. The Chancellor reportedly held calls with business groups last Friday afternoon.
1 in 4 company audits fall short
Although the quality of company audits improved slightly during the pandemic, almost a quarter were still deemed not good enough. The Institute of Chartered Accountants in England and Wales did, however, praise auditors for finding “new and innovative ways to do their work remotely” in lieu of physical visits.
‘More interest rates to come’ says BoE economist
Bank of England chief economist Huw Pill has warned of “a lot more rate hikes to come” if inflation remains at its present level. Prices have been rising at a faster rate than the MPC predicted and expectations of inflation peaking at 6% in April have increased.
Tags:
agency model, BoE, Cambria, company audits, Covid, GDP, interest rates, Jamie Priestley, Linda Jackson, Mini, Nike, Omicron, Peugeot, phygital, Vertu 
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