• RETAIL EV DEMAND NOT HIGH ENOUGH FOR 22% TARGET
• PENDRAGON SHAREHOLDER REVOLT
• MARSHALL LOSES ANOTHER DIRECTOR
• VERTU OPENS NEW SITE IN OLD CAZOO RETAILER
• NEW VOLKSWAGEN UK HEAD OF NETWORK SALES
• FORD CLEARS FIRST LEGAL HURDLE FOR RETAILER EV STRATEGY
• LMP AUTOMOTIVE SELLS FINAL TWO RETAILERS
• STOCKWATCH
• COMING UP: Halifax house price index
• FCA CHANGES RULEBOOK FOR MORTGAGE SUPPORT
• NEW ENERGY PRICE CAP WILL CUT BILLS

Retail EV demand not high enough for 22% target

Retail new car demand for EVs is not yet at a level where the industry will hit the government’s proposed 22% ZEV Mandate target for 2024, according to new research for sister publication Auto Retail Bulletin.

The latest Auto Retail Barometer, which surveys industry sentiment every six months, reveals that more than 60% of new car retailers are experiencing retail battery electric vehicle demand below 15%. For more than a third, retail demand is running at less than 10%.

While fleet demand for EVs is strong thanks to favourable company car taxation policy, there are almost no incentives for retail buyers to go electric.

The ZEV Mandate target proposed for next year includes a hefty £15,000 penalty applied to every car that a manufacturer sells that falls short of the 22% EV mix.

Commenting on the level of retail demand across the industry, SMMT chief executive Mike Hawes told Auto Retail Agenda: “The industry will have to meet the targets, no one wants to pay the high cost of failure to comply, and no one wants to trade [EV credits] so there needs to be more flexibility in the regulations.

“All manufacturers can do is put the vehicles on the market, but government needs to incentivise them and one particular approach would be to sort out the VAT on public charging. At the end of the day, the consumer will vote with their wallets.”

Asked if used car incentives would help consumer demand, he added: “Any measure to support the uptake would be good. Money on the bonnet of new or used would help. Currently the government’s approach is to force the new car market into ZEVs and that’s their route to used ZEVs.”

* Read the full Auto Retail Barometer survey analysis in the July issue of Auto Retail Bulletin

 

Pendragon shareholder revolt

Pendragon shareholders have voted to reject the firm’s annual report on directors’ renumeration. Only 43.5% voted in favour at last Friday’s AGM.

“The board recognises the significant vote against,” said Pendragon.” Although the Renumeration Committee is satisfied its decisions were made in the best interests of all stakeholders, it respects the views expressed by shareholders regarding the resolution in respect of renumeration awarded in 2022.”

In other notable votes, only 58.1% voted to re-elect Bill Berman as CEO, 59.8% voted to re-elect COO Martin Casha and 57.7% voted to re-elect senior independent director Dietmar Exler.

“The company will continue to consult with shareholders to fully understand their concerns in relation to the number of votes recorded not in favour… an update will be provided within six months as required by the UK Corporate Governance Code.”

97.7% voted in favour of re-electing non-executive directors Nikki Flanders and Brian Small, while CFO Mark Willis saw 98% vote in favour.

Last week, it was announced non-executive chair Ian Filby is to step down. Just 54.8% of shareholders voted in favour of his re-election.

 

Marshall loses another director

Marshall HR director Joanne Moxon has left the business. It means the four most senior directors – CEO Daksh Gupta, CFO Richard Blumberger, company secretary Stephen Jones and now HR director Joanne – have left the business over the past year.

 

Vertu opens new site in old Cazoo retailer

Vertu Bristol Street Motornation Tamworth opened last weekend – in a former Cazoo retailer. CEO Robert Forrester said the site sold 10 cars on its first Saturday. “Well done to the team, including [regional director] Steve Gould, who led from the front.”

 

New Volkswagen UK head of network sales

David Hanna is Volkswagen UK’s new head of network sales. He joins on 1 September from head of direct sales at Volkswagen Commercial Vehicles. In taking on the role, David praised Volkswagen’s retailers for helping the brand be the UK sales leader in both 2021 and 2022. He replaces James Douglas who leaves the company on 31 August for a role outside the business.

Last week, it was announced Volkswagen is pausing EV production for six weeks and plans to lay off 300 of the 1,500 workers building them. It says EV demand is running 30% below company forecasts.

https://tinyurl.com/bdfd9vz5

 

WORLD NEWS

Ford clears first legal hurdle for retailer EV strategy

A South Dakota hearing officer has ruled Ford’s electric vehicle certification program for retailers does not violate state franchise law. It is the first decision after numerous legal actions were filed. Cases in New York, Illinois and North Carolina are still to be heard.

The program, called Model e, requires retailers to invest as much as $1.2m (£940k) and adhere to rigorous standards if they are to sell future EVs. It is described as a voluntary program, although retailers argue it violates franchise law as it limits what products they can sell.

Retailers in South Dakota are expected to appeal the decision.

https://tinyurl.com/jtjcp6eb

 

LMP Automotive sells final two retailers

LMP Automotive, which in early 2021 said it hoped to acquire up to 100 retailers by the end of 2022, has sold its last remaining franchised retailers. The LMP board recommended a liquidation and delisting from the Nasdaq in August 2022. “My sense is that they didn’t have a really good business plan,” said Sheldon Sandler, a buy-sell advisor. “LMP seemed to be sort of amateurish.”

https://tinyurl.com/bdjwrn5r

 

 

STOCKWATCH

Closing prices on 30 June 2023 and weekly change

Auto Trader Group 610.4p (+18.8p / +3.1%)

Caffyns 500.0p (n/c)

Halfords 215.6p (+3.6p / +1.6%)

Inchcape 777.5p (+22.0p / +2.8%)

Lookers 119.6p (+0.8p / +0.6%)

Motorpoint 95.4p (-5.1p / -5.2%)

Pendragon 17.66p (-0.22p / -1.2%)

Vertu 71.4p (+2.8p / +4.0%)

 

 

COMING UP

Wednesday, July new car registrations

Friday, Halifax house price index

 

 

MONEY MATTERS

FCA changes rulebook for mortgage support

The FCA has changed its rulebook in support of commitments made by lenders at the recent mortgage summit held by the chancellor. Lenders can offer borrowers a switch to interest-only mortgage payments for six months, or an extension to their mortgage term to reduce monthly payments, with the option to switch back within six months. Both options can now be offered without an affordability check.

The FCA adds that Consumer Duty will also mean lenders must offer support that meets consumers’ individual needs, communicate clearly with them about their options, and provide decent customer support.

https://tinyurl.com/3hztemym

 

New energy price cap will cut bills

Household gas and electricity bills changed on Saturday when Ofgem’s largest energy price cap came into force. The cap is cut from £3,280 to £2,074 – and, as the government’s £2,500 energy price guarantee has now ended, it means the average household energy bull will fall by £426 a year. Unit prices for gas and electricity will fall by around 3p.

https://tinyurl.com/m92ft9re