Auto Retail Agenda: 25 July 2022
23 July 2022
- SNOWS TO GO ALL-MAKES WITH ONLINE CONTRACT HIRE SITE
- TOO-CHEAP USED CARS ARE LOSING RETAILERS MONEY
- USED CAR PRICE SPIKE EASES
- HALFORDS TESTER ISSUES 31 FRAUDULENT MOTS
- AGENCY MODEL: YOUR ONE-STOP GUIDE
- AUTO RETAIL PANDEMIC BOOST IS OVER
- VW CEO SACKED
- STOCKWATCH
- COMING UP: Motorpoint AGM
- INFLATION COULD HIT 15%
- DIGITAL SLOWDOWN ‘CANARY IN THE COAL MINE’
Snows to go all-makes with online contract hire site
South England-based retailer Snows Group is to expand its recently launched online contract hire platform to include all-makes, not just the ones it operates franchises for.
Snows Direct, set up in partnership with fleet and leasing specialist Wessex Fleet, was launched last week offering business and personal contract hire deals from the franchises Snows represents. These include Alfa Romeo, Abarth, BMW, Cupra, Kia, Seat, Toyota, Lexus, Volvo, Vauxhall, Peugeot and Mazda.
The platform allows drivers to find a car, agree to finance and servicing packages and even find additional products such as GAP insurance from their laptop, tablet or mobile.
Speaking to Auto Retail Agenda, Snows Group corporate director Richard Betts said: “Our plan is to add our commercial vehicle brands in the next couple of weeks and we’ll go all-makes after that.
“We see this as a new sales channel for us, not one that will take sales from showrooms. It also means we can take on the brokers by offering online sales but with better service from a family-run business.”
The Snows Direct website is fully outsourced to Wessex Fleet which means Snows doesn’t have to become an authorised representative. This cuts admin and speeds up the launch process.
Wessex Fleet will manage Snows Leasing, which involves advertising offers based on the retailer’s current vehicles and handling the leasing enquiries from interested customers, providing them with quotes and support through the contract stage.
The white label provision is a first for Wessex, according to Wessex Fleet director and former BVRLA chairman Spencer Blake.
Too-cheap used cars are losing retailers money
Retailers are losing an average of £11,000 a month in potential profit due to under-priced stock, says Auto Trader. The marketplace is urging retailers to use live retail market data instead of “unsubstantiated speculation or editorial guidance”. Stock that’s too cheap also risks not appearing in search results for a customers’ chosen budget, and seed ‘too good to be true’ distrust.
Used car price spike eases
Latest ONS data shows used car prices have declined for the fifth month running with a 2.5% drop in June. As inflation hits a 40-year high and fuel costs surge, used cars “are becoming a luxury” says Bloomberg. Despite this, used car supply remains challenging: “What surprises me is actually how difficult it still is to get hold of a used vehicle,” said Jason Barlow of St Leonards Motors.
Halfords tester issues 31 fraudulent MOTs
A Taunton Halfords MOT tester has admitted issuing 31 MOT certificates over a three-month period without carrying out any tests. A DVSA investigation uncovered the fraud. The tester, who is on bail, will be sentenced next month.
Agency model: your one-stop guide
Auto Retail Agenda has published a complete guide to which car brands are adopting agency agreements. The guide is constantly updated and includes links to full details on each OEM’s plans.
* Bookmark your guide to agency and OEMs: https://bit.ly/3OSmxfw
WORLD NEWS
Auto retail pandemic boost is over
Profit growth at US auto retailers is forecast to slow in Q2 due to ongoing supply issues and rising fuel costs. Cash-flush Americans during the pandemic turbocharged auto sales in 2021 despite price hikes. Prices are now forecast to fall in H2 with the threat of a recession growing. Investors will be watching the comments from industry executives for warning signs over consumer behaviour; largest US retailer AutoNation reports on Thursday.
VW CEO sacked
Volkswagen CEO Herbert Diess was sacked late on Friday after four years in charge. He reportedly had an abrasive management style and clashed with Germany’s powerful unions. Diess is the fourth CEO in a row not to serve out their contract. “There are too many different interests in this company,” said one insider. “It is a listed company but is very much in private hands.”
Porsche CEO (and VW Group lifer) Oliver Blume will succeed Diess on 1 September.
STOCKWATCH
Closing prices on 22 July 2022 and weekly change
Auto Trader Group 612.4p (+34.2p / +5.7%)
Caffyns 550.0p (n/c)
Halfords 170.9p (+13.4p / +8.1%)
Inchcape 793.0p (+38.0p / +4.9%)
Lookers 78.7p (-0.2p / -0.2%)
Marshall Motor Holdings 397.0p (n/c)
Motorpoint 193.0p (-0.25p / -0.1%)
Pendragon 21.6p (+1.6p / +7.6%)
Vertu 58.0p (+1.8p / +3.1%)
COMING UP
Wednesday, Motorpoint AGM
Wednesday, BRC Shop Price Index
Friday, Aston Martin H1 results
Friday, Nationwide House Price Index
2 August, Cazoo Q2 and H1 results
MONEY MATTERS
Inflation could hit 15%
Inflation hit 9.4% in June and could reach 15% this winter warn EY economists. The worst-case scenario is based on Russia turning off the gas taps and food inflation continuing. Even a less dramatic scenario puts inflation at 10%. Companies should try to be creative with pay deals, with more perks or profit-related pay to keep key staff, the economists advised.
Digital slowdown ‘canary in the coal mine’
Weak earnings from social media companies Twitter and Snap have alarmed economists about a wider economic slowdown. Because it is so easy to turn on and off, digital advertising is a leading indicator of the online economy – and is the “canary in the coal mine” for the entire consumer internet sector, said one analyst.
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