06 October 2019

Record profit and revenue for Sytner

US-owned Sytner, the UK’s largest retail group, achieved record profit before tax of £113.3 million in 2018 (2017: £99.1m) as revenue grew 7% to almost £6bn. This was also an all-time high for the group.

Part of the Penske Automotive Group, multi-brand retailer (which still leads on BMW, with 18 franchises) says growth was achieved largely by expansion in its used car supermarket division. In January 2018, it bought The Car People Ltd, since rebranding its four sites to CarShop. Sytner now has nine used car supermarkets. Used car sales grew 30% in 2018.

It has also focused on aftersales to drive profits, conceding that the new car market has suffered a downturn in trading conditions. Sytner disposed of its final Lexus retailer, in Leicester, during 2018.

The group’s focus is now on organic growth, working with key franchise partners such as Mercedes-Benz (15 retailers), Audi (14 retailers) and Land Rover (12 retailers). Further capital investment in the used car supermarket business is also planned for the next few years.

Eden profit slips to £2.6m

Eden Automotive Investments has reported a fall in profit before tax from £3.9m to £2.6m during 2018, as turnover declined £10m to £290m. It acquired two businesses, Vauxhall Swindon (from the administrators of Now Motor Retailing) and Hyundai High Wycombe.

The Vauxhall-focused division, Eden Automotive, saw turnover decline 7% in 2018, from £213.4m to £199.3m. Despite this, profit before tax grew 20%, from £1.56m to £1.87m. However, its Hyundai, Mazda and Fiat division, Eden Motor Retail, posted a pre-tax loss of £1.68m, despite turnover improving 20% to £89.3m.

Car retailers on Sunday Times Top Track 250

11 car retailers feature on the Sunday Times Top Track 250 of leading private mid-market growth companies. Milton Keynes’ Steve Eagell is the highest-ranking, in 31^st place. Also listed are AvailableCar (34), Hatfields (67), The Trade Centre Group (90), Day’s Motor Group (104), Big Motoring World (126), Motordepot (131), Toomey Group (148), Cotswold Motor Group (159), Saxton 4×4 (208) and Riverside Motor Group (216).

Distributor IM Group is ranked third overall.

http://bit.ly/2Oq0ZdE

Car Giant vs Crossrail and HS2

White City retailer Car Giant has been backed by planners in a row over the compulsory purchase and redevelopment of its Hythe Road base. The Old Oak Park Development Corporation wants to build 26,500 homes at the interchange of Crossrail and HS2 in West London. But Car Giant doesn’t want to move and the report says “its extinction simply does not make sense”. Owner Geoff Warren said the report “vindicates everything Car Giant has been saying.

http://bit.ly/2MlcnVF

WORLD NEWS

Citroen CEO Jackson to visit Inchcape Australia

Linda Jackson, Citroen CEO, is visiting Australia to celebrate the brand’s centenary – and “assess its future in the local market”. Two years ago, Inchcape took over Citroen Australia; it sold 323 cars in the first nine months of 2019. Jackson admitted volumes were modest but “it means that we have a potential to do better in the future. That’s why I’ve come here”.

http://bit.ly/35eP5tk

Trade row sees Japanese car sales slump in S Korea

A diplomatic row between Japan and South Korea has evolved into a trade battle. Total sales from Toyota, Hyundai and Nissan fell 74% in September, despite overall imported vehicle sales rising 17%. The row, which has seen South Koreans boycott Japanese goods, is over compensation for wartime labour.

https://bbc.in/335AnCN

STOCKWATCH

Closing prices on 04 October 2019 and weekly movement

Auto Trader buys KeeResources for an undisclosed sum

Auto Trader Group 488.0p (-23.8p)

BCA 235.6p (n/c)

Cambria 57.0p (n/c)

Caffyns 400.0p (-10.0p)

Inchcape 619.0p (-14.5p)

Lookers 56.4p (-0.3p)

Marshall Motor Holdings 143.5p (-0.5p)

Motorpoint 220.0p (+2.0p)

Pendragon 9.45p (+0.1p)

Vertu 32.7p (-0.3p)

LAUNCH DIARY

Ford Puma, small SUV positioned below Kuga and above Ecosport, from £20,845, deliveries January 2020

Polestar 2, performance fastback rival to Tesla Model 3 arriving June 2020, from £49,900

BMW 3 Series Touring, in dealers now from £35,505; plug-in hybrid confirmed for summer 2020

COMING UP

Monday, Halifax house price index

Wednesday, Vertu H1 interim results

Wednesday, Auto Retail Live Profit Briefing: How to increase loyalty and win sales in a falling market

MONEY MATTERS

UK service sector ‘weakest since July 2016’

The UK service sector suffered the biggest employment decline in nine years during September. Companies are now the least optimistic of future growth since the EU referendum in July 2016, says the latest IHS Markit / CIPS PMI report. Jobs fell at the fastest rate since August 2010: most survey respondents said it was the non-replacement of leavers, rather than redundancies.

Extinction Rebellion targets City of London

Extinction Rebellion is planning two weeks of protests across the City of London. Westminster will be the focus of the first week, from today (Monday), with the City of London (including the Bank of England) targeted the week after. The group says demonstrations will be five times bigger than in April and is aiming for “maximum disruption”.

BLOG: Will crossovers help OEMs solve the SUV CO2 conundrum?

Tags: Car Giant, Citroen, Eden, Extinction Rebellion, IM Group, Inchcape, KeeResources, Penske Automotive Group, Steve Eagell, Sytner Group, Vertu