• EVs GIVE FRANCHISES HUGE OPPORTUNITY OVER INDYS
• SHAREHOLDER AGM ATTENDANCE BOOM DUE TO ESG
• WFH TO FALL AS ENERGY BILLS RISE?
• RON BROOKS TOYOTA FOUNDER ELSIE DIES
• WARREN BUFFETT INVESTS IN AUTO FINANCE GIANT
• CARVANA PLANS $15m ‘CAR VENDING MACHINE’ FOR DETROIT
• STOCKWATCH
• COMING UP: Lookers H1
• ENERGY CRISIS BAILOUT FOR BUSINESS MOOTED
• UK DEBT COSTS SPIRAL

EVs give franchises huge opportunity over indys

OEM investment in electric vehicles, including extensive retailer training, means franchised retailers are better prepared to capitalise on the EV future than independents, Auto Trader insight director Nick King told retailers last week during an NFDA session at the British Motor Show.

Surprisingly, in a survey of 341 retailers, almost 1 in 4 say they plan never to sell EVs.

This knowledge gap, which is growing all the time, means it will take independents time to catch up – giving franchises a huge opportunity to grow market share as the EV marketplace expands.

Indeed, the shortage of used cars, caused by 2m fewer new cars entering the marketplace, will compound this effect, said Mr King. “There will be a 30% drop in three- to five-year old used cars in 2025; add in the expected 20% of cars available in 2025 being EVs, and it means those who have not brought into EVs will see the stock mix of cars they can go after is halved.”

He also revealed stats that showed it took 50 days to turn an EV in May 2021; today, this has fallen to just 20 days. “Used car buyers are enormously fuel-sensitive; when fuel prices go up, we see a huge spike in EV searches.”

In a related take on the cost of living crisis, electric cars cut running costs by 70%, saving motorists £160 a month, according to data from Volkswagen Financial Services. “The case for making the switch to electric is getting stronger all the time,” said CEO Mike Todd.

 

Shareholder AGM attendance boom due to ESG

Shareholder attendance at AGMs has jumped 134% in the past 12 months due to an eagerness to hold bosses to account on ESG and pay issues. Engagement at meetings has also reached record levels. “The shareholder voice is louder than ever,” said Lumi, a company that manages AGMs for the entire FTSE 100. Digital AGMs are helping drive engagement, adds the firm; two in three AGMs this year were done entirely digitally.

https://bit.ly/3QGPrjp

 

WFH to fall as energy bills rise?

Average UK office attendance is 29%, or less than 1.5 days a week. Fewer than 1 in 2 UK employees travel to work every day. But rising energy costs may drive people back to the office: by January 2023, the savings on household bills will outweigh the cost of commuting to the office. Many Brits have already returned to air-conditioned offices during the heatwave.

https://bit.ly/3R0y6BM

 

Ron Brooks Toyota founder Elsie dies

Elsie Brooks, who founded Ron Brooks alongside Ron in 1962, has died, aged 92. The 60-year old business has been a Toyota retailer for 50 years. “Elsie was ahead of her time,” said MD (and son-in-law) Kevin Slack, “respected as a powerful but fair woman in a male-dominated industry”.

 

 

WORLD NEWS

Warren Buffett invests in auto finance giant

Warren Buffett’s Berkshire Hathaway has tripled its stake in auto lending giant Ally Financial Inc, to 9.3% – a stake worth over $1bn. Formerly known as GMAC Financial, it has generated an average 16.9% return on equity over the past year. It also operates an insurance firm, and is the largest all-digital retail bank in the US.

https://bit.ly/3K7frCh

 

Carvana plans $15m ‘car vending machine’ for Detroit

Money-losing online used car retailer is planning another ‘car vending machine’ for Detroit. The $15m investment would create a 12-storey steel and glass tower to display used car. The target construction date is late 2023 or early 2024, with completion 10 months later.

“Carvana has been able to separate itself from other internet auto sales companies by offering its customers a physical location,” said the planning announcement.

Carvana lost $945m in H1 2022.

https://bit.ly/3dLXQU5

 

STOCKWATCH

Closing prices on 19 August 2022 and weekly change

Auto Trader Group 675.0p (+16.2p / +2.4%)

Caffyns 550.0p (n/c)

Halfords 156.7p (-10.2p / -6.3%)

Inchcape 809.5p (-19.5p / -2.3%)

Lookers 79.1p (+0.2p / +0.2%)

Motorpoint 196.25p (-0.75p / -0.3%)

Pendragon 24.2p (n/c)

Vertu 51.2p (-3.9p / -7.3%)

 

COMING UP

Wednesday, Lookers H1 results

 

 

MONEY MATTERS

Energy crisis bailout for business mooted

Chancellor Nadhim Zahawi is believed to be drawing up proposals to help businesses with rocketing energy bills. The package may include the option of repurposing Covid schemes, as these are quick to deploy and proven to work at scale. They include grants to SMEs, plus VAT and business rates holidays.

https://bit.ly/3pxDL6D

 

UK debt costs spiral

Interest payments on government debt have leapt 63% over the past year, due to inflation. The UK also borrowed more than expected in July as public spending outstripped taxes. The total budget deficit for the year has hit £55bn.

https://bit.ly/3wjjzJs