Auto Retail Agenda: 1 September 2020
28 August 2020
- HEADLINE SPEAKERS WILL HELP YOU MEET 70-PLATE TARGETS
- WELSH SYTNER BMW MINI CLOSES
- STONEACRE TARGETS DISUSED LAND FOR VOLVO SITE
- VIDEO ‘TREBLES CONVERSION’
- WORLD NEWS – US sales will be down 22%, car buyers return ‘sooner than expected’
- STOCKWATCH – Pendragon decline
- COMING UP – SMMT August registration figures
- MONEY MATTERS – JPMorgan Inchcape upgrade calls bottom of market, car finance boom
Headline speakers will help you meet 70-plate targets
Marshall Motors’ Daksh Gupta, Waylands’ founder John O’Hanlon, Mazepoint’s Tracy Ellam and Auto Trader’s Ian Plummer are lined up for the next Auto Retail Live webinar on September 15, promising critical insight to hit your 70-plate targets.
Set to be 2020’s most important month, the webinar will how you hot to hit September targets without pre-registration, help grow your profitability and maintain impetus for the rest of 2020.
Thanks to business intelligence provider Mazepoint, it’s free, so sign up now for the 2pm online session on Tuesday September 15.
SMMT chief executive Mike Hawes has already described September as “make or break” for the UK automotive industry in 2020. Mr Gupta said it could be one of the biggest Septembers on record, if retailers are able to secure sufficient supply, while Vertu’s Robert Forrester implored retailers to make the most of a “substantial” increase in demand as “no one yet knows what the economy will look like in six months”.
Welsh Sytner BMW Mini closes
The Sytner BMW Mini retailer in Haverfordwest, Pembrokeshire has closed. The site has represented the brands since 2016 but, in 2017, Sytner acquired Swansea BMW Mini. As a result, it has had to “reconsider how we best serve the South Wales community”. Franchise director Andy Crossan said in a letter the retailer aims to “retain as many of our colleagues as possible”.
Haverfordwest vehicles were redistributed to Sytner’s Cardiff and Swansea sites last week. Both sites will continue.
Stoneacre targets disused land for Volvo site
Stoneacre Motor Group wants to redevelop a former manufacturing site in Southwick, Sunderland into a Volvo retailer employing 23 staff. Sunderland City Council has already recommended approval, which will be considered by the planning committee this week (4 September). The Castletown site would include a two-storey building and 119 parking spaces.
Video ‘trebles conversion’
Video has been a “game changer” for retailers claims Heycar CCO Karen Hilton after revealing figures to Auto Retail Agenda showing listings where a video has been played are three times more likely to convert into a lead. 1 in 4 of all listings now have a related video, and the convenience and safety is why “such large numbers of browsers are converting into solid leads for dealers”.
US sales will be down 22%
Covid-19 will cause a 22% fall in US car sales predicts a new report from Cleveland research company Freedonia Focus. Other factors include the retirement of baby boomers, more reliable vehicles, young drivers acquiring their licences later and a growth in urbanisation. However, despite a loss in disposable income, low interest rates and stimulus cheques are expected to help stem the 2020 decline.
Buyers return ‘sooner than expected’
Extended production shutdowns, combined with buyers returning sooner than expected, has “put the bargaining power into the hands of car dealers”. Cox Automotive economist Jonathan Smoke calls the recession “unlike any that the auto industry has seen before” which is why US transaction prices of both new and used cars have risen in 2020. American retailers are seeing gross profit of more than $1,100 per vehicle, with used vehicle profit “easily” twice that.
Closing prices on 28 August 2020 and weekly change
Pendragon decline an exception during quiet week
Auto Trader Group 563.2p (+7.0p / +1.2%)
Cambria 51.0p (n/c)
Caffyns 270.0p (n/c)
Halfords 165.0p (-0.2p / -0.1%)
Inchcape 505.5p (+14.3p / +2.8%)
Lookers Shares suspended at 21.0p
Marshall Motor Holdings 127.5p (n/c)
Motorpoint 271.0p (n/c)
Pendragon 7.7p (-0.8p / -9.8%)
Vertu 24.0p (-1.2p / -4.7%)
Tuesday, UK consumer credit
Wednesday, British Retail Consortium shop price index
Friday, SMMT August new car registrations
JPMorgan Inchcape upgrade calls bottom of market
Inchcape has been upgraded by JPMorgan Cazenove analysts who have called the bottom of the auto retail market.
“Timing is difficult, but at some point, we think the group will begin to see materially stronger earnings momentum.” Inchcape has been upgraded from ‘neutral’ to ‘overweight’ and given a target price of 595p, a significant increase from the previous 510p.
In other Inchcape news, Norway’s Norges Bank reduced its stake in Inchcape from just above 3% down to 2.998%. The disposal reduces Norges’ holding to below that required to be reported in annual accounts.
Car finance applications up 24%
Pent-up demand for new and used cars has seen finance applications grow 24% to almost 600k in July and August, figures from Experian show. Head of automotive Gerardo Montoya described the growth as marked, and said demand had come both from those who had saved money during lockdown and people who were uncomfortable using public transport.
FT automotive industry correspondent Peter Campbell called the figures “promising signs as we head into September”.