Auto Retail Agenda: 9 October 2023
08 October 2023
- AUTONATION TO LAUNCH NEW BID FOR PENDRAGON?
- £504m LOOKERS ALPHA AUTO DEAL FINALISED
- GROUP 1 AUTOMOTIVE UK IN £61.3m PROFIT
- THOMPSON FIRST MG SUDDENLY CLOSES
- JOIN AUTO RETAIL LIVE NEW ENTRANTS 2023 WEBINAR
- ONLINE USED CAR RETAILER FILES FOR BANKRUPTCY
- EU TO LOOSEN ‘MADE IN EUROPE’ EV RULES
- STOCKWATCH
- COMING UP: Auto Retail Live New Entrants 2023
- UK ON COURSE FOR ‘BIGGEST TAX RISE IN 50 YEARS’
- EV CAR INSURANCE NOW 27% MORE THAN ICE
AutoNation to launch new bid for Pendragon?
AutoNation CEO Mike Manley is reportedly considering making a fresh bid for Pendragon, the UK’s second-largest auto retailer.
An earlier AutoNation bid for 32p a share was rejected.
US rival Lithia Motors is currently leading the race to acquire Pendragon, in a 35.4p a share deal. Pendragon’s largest shareholder, Hedin, last week dropped a joint bid with US retailer Penske Automotive Group.
Hedin is reportedly yet to be convinced of Lithia’s cash and shares deal. Anders Hedin’s preference is to sell his entire shares for cash: the current deal is for 24p a share plus shares in Pinewood Technologies valued at 11.4p a share.
City sources suggest AutoNation has cash reserves to pay as much as 38p a share. This would value Pendragon in excess of £500m – and would be sufficient for the Pendragon board to drop its recommendation for the Lithia bid.
Manley, a Brit who was born in Edenbridge, Kent, could also acquire Hedin’s 28% stake and use this as leverage for a counter-bid.
Hedin’s stake has almost doubled in value over the last month.
£504m Lookers Alpha Auto deal finalised
Alpha Auto Group affiliate Global Auto Holdings has completed its £504m deal to buy Lookers. The takeover of Lookers’ 147 retailers in the UK and Ireland formally closed last Friday.
In its initial bid, Global said “there may be some restructuring required” in certain corporate and support functions, due to the transition away from public ownership, but it has “no intention of making other employee or management changes”.
Group 1 Automotive UK in £61.3m profit
Group 1 Automotive UK has reported a £61.3m profit before tax on turnover of £2.24bn for the year ended December 2022. Turnover increased 15%, which it said was due to strengthening used car prices and improved new car supply. Group 1 Automotive’s UK division was also bolstered by the acquisition of the nine-site Robinsons Motor Group, and it acquired Fairfield Motor Group in September 2022.
Figures reveal its technician headcount swelled from 870 in 2021 to 997 in 2022.
Thompson First MG suddenly closes
Thompson First MG in Stroud has suddenly ceased trading after more than half a century. It switched from Citroen to the MG franchise in 2019. “The owner, quite a while back, made the decision not to renew the MG dealership,” said John Hawkins from commercial lettings agency Hawkins Watton.
Join Auto Retail Live New Entrants 2023 webinar
BYD head of marketing Mark Blundell, Urban Science MD Chee-Kiang Lim and Auto Trader commercial director Ian Plummer will share their knowledge about the new brands set to arrive from China and beyond this Thursday at 9am. The webinar marks the launch of the Auto Retail network New Entrants Report 2023, which examines in detail the most significant brands and their aspirations for the UK.
Register for the 40-minute webinar here: https://tinyurl.com/w9pypmy7
WORLD NEWS
Online used car retailer files for bankruptcy
Shift Technologies, a West Coast online used car retailer, is to file for Chapter 11 bankruptcy protection. It has recorded consistent net losses amid volatile used vehicle market conditions. “This decision follows months of trying to raise capital and restructure the balance sheet,” said CEO Ayman Moussa.
Shift went public through a Spac in 2020.
EU to loosen ‘made in Europe’ EV rules
Tariffs on electric vehicle sales between the UK and EU are set to be delayed for a year, to give OEMs more time to switch battery sourcing from Asia to Europe. The ‘made in Europe’ rules are set to come into force on 1 January 2024, and place a 10% tariff on vehicles that don’t have at least 60% of their battery packs, and 45% of their parts by overall value, sourced from either the EU or UK.
The UK had been pushing for a three-year delay to the changes.
STOCKWATCH
Closing prices on 6 October 2023 and weekly change
Auto Trader Group 617.6p (-7.4p / -1.1%)
Caffyns 550.0p (n/c)
Halfords 198.3p (-4.9p / -2.4%)
Inchcape 758.5p (-7.5p / -0.9%)
Lookers 129.6p (+0.2 / +0.1%)
Motorpoint 88.0p (n/c)
Pendragon 33.3p (+3.2p / +10.0%)
Vertu 74.7p (+0.5p / +0.6%)
COMING UP
Monday, NFDA Dealer Attitude Survey: Auto Retail Agenda will issue a news alert at 9am
Tuesday, Bank of England update on risks to the financial system
Tuesday, UK retail sales
Thursday, Auto Retail Live New Entrants 2023 webinar. Sign up here: https://tinyurl.com/w9pypmy7
Thursday, GDP
6 December: NFDA Driving Digital: Special Edition. Sign up here: https://tinyurl.com/mt2y378d
MONEY MATTERS
UK on course for ‘biggest tax rise in 50 years’
The Resolution Foundation says taxpayers will hand over £40bn a year by 2028, up from Chancellor Jeremy Hunt’s forecast of £30bn – and likely to be the biggest tax raise in at least 50 years.
The government’s “stealthy” policy of freezing income tax and national insurance thresholds until 2028 will drive the increase by pushing many into higher tax bands due to inflation.
EV car insurance now 27% more than ICE
Electric car insurance can cost up to 27% more than a petrol or diesel version of the same model, confused.com figures have revealed. EV premiums have also risen 72% year to date, compared to a 29% rise for ICE cars. A Tesla Model Y costs an average of £1,421 to insure, it added – nearly 80% more than a BMW X3 M40d.
Last week, John Lewis underwriter Covea stopped offering car insurance for electric cars.
Tags:
Alpha Auto, Auto Retail Live, AutoNation, car insurance, EU, EV, Global Auto Holdings, Group 1 Automotive, Hedin, Lookers, MG, Pendragon, Penske, Shift, tax rise 
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