03 November 2019

• LLOYDS BANK HIT BY FALLING USED CAR PRICES
• NEW DIRECTORS AT GLYN HOPKIN
• ARBURY TAKES ON PENDRAGON JLR
• GLEWS OF GOOLE IN TALKS OVER FUTURE
• WORLD NEWS – Michael Cole is Kia America president; India sales row
• STOCKWATCH – Stocks fall after Lookers announcement
• LAUNCH DIARY – Skoda Octavia, Renault Clio
• COMING UP – Aston Martin, Auto Trader interim results
• MONEY MATTERS – UK economic growth cut; EV money-makers
• BLOG – Lookers: the inside track

Lloyds Bank hit by falling used car prices

Lloyds Banking Group has announced an impairment charge of almost £1 billion in its Q3 results – which it attributed partly to its motor finance business as a result of falling used car prices. CFO William Chalmers said, during an investor call, a buoyant new car market in 2016 has caused softening of prices from cars on three-year contracts. Demand is also constrained due to the “uncertain macroeconomic environments”.

The total impairment charge was £950m: Chalmers declined to put a figure on the motor finance element of it. Recently, he added, the business has seen used car prices show signs of improvement. “I don’t want to call out just yet, because it’s just too early to say, but it is looking better recently versus what we’ve seen in the first three quarters of this year.”

The Lex Autolease business has also seen a reduction in its fleet size. Chalmers blamed this on corporates revising their company car strategies, and the firm adjusting prices to meet margin expectations.

New directors at Glyn Hopkin

Two new directors have been announced at Glyn Hopkin. Shabir Chowdhury has become sales director and Mark Goddard has become service director. Both appointments were announced late on Friday 1 November.

Last month, Glyn Hopkin revealed 2018 profits were down 40% to £3.1m. Turnover was up 2.4% to £437.9m. Five new non-board director positions were created, covering sales and aftersales. The directors said this was to “heighten focus on franchise partners and harness business opportunities”.

Arbury takes on Pendragon JLR

Arbury Group has bought the site of a former Jaguar Land Rover retailer in Stourbridge, West Midlands. Pendragon closed the site in July 2019, which a local newspaper reported would put 150 jobs at risk.

Arbury will open Seat Stourbridge on the site in January 2020, which will create 25 new jobs (all positions are currently being recruited for on the company’s careers page). Finance director Neil Barrett said the firm is now giving the site a full Seat makeover. It will be Arbury’s second Seat franchise.

Glews of Goole in talks over future

Long-running family-owned used car retailer Glews Garage has announced it is in talks with employees over its future. “Operating a car dealership in Goole has always been exceptionally tough, no matter what the wider economic conditions,” said owners Jos Richardson & Sons Ltd in a statement. All options are being considered, including third parties taking on the site.

WORLD NEWS

Cole is Kia America president

Former Kia UK MD Michael Cole has been appointed president of Kia Motors America. Cole joined the American business in May 2018 as COO and executive vice president. “Michael Cole has helped reintroduce the Kia brand in the U.S. and Kia has outperformed the industry through the first three quarters of 2019,” said Kia Motors North America president and COO Sean Yoon, to whom Cole will report.

India ‘should report retail car sales’

Mahindra Group chairman Anand Mahindra has called for the Indian car industry to report monthly retail figures rather than wholesale. In recent months, Indian OEMs have been more restrained in wholesale deliveries to “slash” pipeline stocks, with Mahindra posting a 23% wholesale decline in October.

Retail sales, said the company’s MD, were the highest ever for October. Other OEMs report the Indian new car market is in better health than wholesale figures suggest.

Tags: Arbury, EY Item Club, Glews Garage, Glyn Hopkin, Lex Autolease, Lloyds banking group, Lookers, Mahindra Group, Michael Cole, Pendragon