Auto Retail Agenda: 30 May 2022
28 May 2022
- FORD MULLING AGENCY MOVE
- SMART AGENCY AGREEMENTS TO BE IN PLACE BY SUMMER
- MERCEDES PCP CUSTOMERS WIN MILEAGE FEE COMPENSATION
- BMW AGENCY BY 2026?
- AUTO RETAIL LIVE LINE-UP CONFIRMED
- VW ‘ALARMS AND PUZZLES’ US RETAILERS
- FORD FINED $19.2m FOR FALSE ADVERTISING
- STOCKWATCH: Caffyns annual profit before tax soars to £4.6m
- COMING UP: Queen’s Platinum Jubilee
- KPMG TO CUT BACK ON AUDITS – AND COSTS TO RISE
- CHANCELLOR SUPPORT LOWERS RISK OF RECESSION
Ford mulling agency move
Ford is considering a move to the agency model for its UK retail network and in other countries, executives within the firm have confirmed.
Two years after Auto Retail Agenda exclusively revealed Ford planned to halve its network, and 18 months after Lisa Brankin took over as managing director, the brand is now looking at a move to agency agreements for its remaining 335 dealers.
Auto Retail Agenda sources said that rumours had been circulating about a possible move to agency, but one Ford retailer said that official talks with the network had not yet taken place.
However, when asked about agency model, a spokesman said: “We have been sort of public on considering new arrangements, and I think we’re actively talking to dealers. Not just in the UK. Other markets are going through the same discussions, but it is a two-year plan.”
“It is known that we are exploring the agency model,” added fleet aftermarket customer experience manager Andy Paton said. “We are exploring it in the Netherlands right now and will expand as necessary.”
Ford joins a growing list of brands that have either confirmed the move to an agency model or are considering it, including Mercedes, Volkswagen, Audi, Seat, Skoda, BMW, Volvo, Polestar and Ineos Automotive, the manufacturer of the Grenadier off-roader.
Smart agency agreements to be in place by summer
Mercedes-Benz sister brand Smart will have signed agency agreements in place with its network this summer, according to the brand’s UK managing director David Browne.
The move could put Smart’s 19 partners, with 34 showrooms, ahead of Mercedes-Benz, which is not expected to have its new agency agreements in place until 2023.
“We’ve got letters of intent in place, and we’re just working through the details of the contract now with a view to getting that signed by the summer,” said Mr Browne, who was speaking at the launch of the #1 (pronounced ‘hashtag one’) all-electric family SUV.
Mr Browne added that, due to limited production and a desire for strong residual values, it was unlikely there would be a volume-related element to payments under the agency model. He also ruled out geographically different payments to help those retailers in high-cost urban areas.
“Fundamentally, the most important part of the margin would be fixed. What we are working through is [the desire for] a degree of variable elements, just to make sure everybody’s objectives are aligned. And that might be looking at customer satisfaction, for example. One of the discussions is, could that be a volume-related bonus? My understanding is yes, in theory, we could do that. The question is, do we want to do that? We are working through it at the moment.”
* Read the full interview with Smart’s David Browne in the June issue of Auto Retail Bulletin. Sign up for a free trial
Mercedes PCP customers win mileage fee compensation
Mercedes-Benz Finance has been ordered to waive or return penalties of more than £4k against drivers who exceeded their agreed mileage limits. The Financial Ombudsman found the company in breach of consumer rights rules. There have been compaints against other car makers but, unlike Mercedes-Benz, they were dismissed as the lenders’ small print was found to be fair.
BMW agency by 2026?
BMW sales and marketing boss Pieter Nota has confirmed talks with European retailers over a move to the agency model. It has been reported BMW will end its authorised dealer system in 2024 for Mini and 2026 for BMW. Rolls-Royce will remain with the current franchise model.
Auto Retail Agenda has already reported some BMW Group UK employees are using ‘Future Retail UK’ job titles.
Auto Retail Live webinar line-up confirmed
Peter Smyth from Swansway Garages, John O’Hanlon from Waylands, Jonathan Gravell from Gravells and Bex Clarke from Auto Trader will form the panel for the next Auto Retail Live webinar on 14 June. Register to join the discussion.
WORLD NEWS
VW ‘alarms and puzzles’ US retailers
Volkswagen US retailers and NADA are seeking assurances on how the brand intends to sell its new Scout SUV and pickup brand following an “alarming and puzzling” surprise announcement of the plans. Scout will be a “separate, independent company”, leaving retailers worried it will either be direct to consumer or a competing franchise.
Ford fined $19.2m for false advertising
Ford has agreed to pay $19.2m (£15.2m) to resolve allegations it falsely advertised real-world fuel economy and payload for some hybrid and pickups. The company has already mailed cheques of up to $550 to C-Max hybrid owners to make up the difference in fuel costs.
STOCKWATCH
Closing prices on 27 May 2022 and weekly change
Caffyns annual profit before tax soars to £4.6m
Auto Trader Group 576.8p (+26.2p / +4.6%)
Caffyns 602.5p (+52.5p / +9.1%)
Halfords 223.4p (+8.4p / +3.8%)
Inchcape 740.0p (+40.5p / +5.6%)
Lookers 73.0p (+4.5p / +6.3%)
Marshall Motor Holdings 397.0p (+2.0p / +0.5%)
Motorpoint 231.0p (+4.0p / +1.7%)
Pendragon 23.0p (+0.1p / +0.4%)
Vertu 58.4p (+4.1p / +7.2%)
COMING UP
Tuesday, Nationwide House Price Index
Tuesday, UK Consumer Credit
Wednesday, BRC Shop Price Index
Thursday, Spring Bank Holiday
Friday, Queen’s Platinum Jubilee
MONEY MATTERS
KPMG to cut back on audits – and costs to rise
KPMG will cut the number of companies it audits to focus on improving standards. It will be “selective” about competing for tenders. Stock markets rules dictate audit contracts must rotate every 10 years.
The company’s head of UK audit has also warned feels will rise by up to 20% as it deploys more auditors on each job, while competition for staff is pushing up wages.
Chancellor support lowers risk of recession
The chancellor’s £15bn cost of living package has lowered the risk of a recession, according ot leading economists. Although a Q2 contraction is predicted, partly due to the extra bank holiday for the Jubilee, an H2 contraction can be avoided.
Tags:
agency model, BMW, Caffyns, Chancellor, Financial Ombudsman, Ford, KPMG, Mercedes Benz, NADA, SMART, Swansway, Volkswagen 
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