Auto Retail Agenda: 26 May 2020
25 May 2020
- OFFICIAL: SHOWROOMS TO REOPEN ON 1 JUNE
- DRIVE MOTOR RETAIL CLOSES SITE
- NEW VIDEO CHAT SERVICE LAUNCHED
- MOTORPOINT ADDS NEW NON-EXEC
- HOLDEN EXTENDS DEALER WIND-DOWN OFFER
- EBAY CLASSIFIEDS UP FOR SALE
- STOCKWATCH – Pendragon up despite 4 in 10 shareholders voting against directors’ renumeration
- COMING UP – GFK consumer confidence, Radius Law webinar
- RETAILERS URGED TO ‘HOLD FIRM’ ON USED PRICES
- PLUG-IN CAR GRANT APPEAL WIN
Official: showrooms to reopen on 1 June
Car showrooms will be allowed to reopen from 1 June, PM Boris Johnson confirmed in Monday 25 May’s daily briefing. A formal announcement will come later this week. The lift in restrictions is subject to social distancing regulations.
Answering a question on Sunday about when retailers would be able to reopen, the Prime Minister said the UK was “firmly on the roadmap” to phase two but it would be contingent on the R rate of transmission remaining low. He had previously said phase two was likely to be confirmed on Thursday (28 May).
Sky News reports PM Boris Johnson held a cabinet meeting on Monday to discuss easing lockdown measures, which included reopening car dealerships. However, no changes are expected before June 1.
Required measures will include social distancing signs, hand sanitiser stations and one-way walking arrangements.
Volvo chief executive Hakan Samuelsson has spoken of ‘revenge buying’, reports the Daily Mail. “People are tired of sitting at home locked in and want to go out and buy.” Research by What Car? indicates one in five car buyers is looking to purchase in June.
Drive Vauxhall to close site
Drive Vauxhall in Haverhill will not reopen after the coronavirus crisis. Group managing directors Rob Keenan and Stuart Harrison said the decision to close with immediate effect followed “an extensive business review”.
In June 2019, Leicestershire-based Drive Motor Retail reported a fall in profits from £6.7m to £1.7m. Turnover was flat at £219m, although it did acquire three new sites in the North East following the purchase of Sherwoods Group.
The group was established in 2003 by Paul Manning and Steve Bessex through a management buyout of nine Arriva Vauxhall retailers.
Global launch for new video chat service
Rapid RTC has fast-tracked the launch of a new video chat service called Live Dealer. It allows retailers to easily “mimic the physical sales process” and communicate via two-way video, or one-way video, voice or chat if customers prefer.
The company claims there are no device, download or location limitations, and says it works with all common browsers for a “truly frictionless digital conversation”.
Motorpoint appoints new non-exec
Keith Mansfield has joined Motorpoint as an independent non-executive director. He will chair the audit committee and joins both the nomination and renumeration committees. Mr Mansfield is a chartered accountant and worked at PwC for more than 30 years.
Holden extends dealer wind-down offer
Holden retailers have until 30 June 2020 to accept the manufacturer’s closure package. The compensation package includes a long-term service and parts supply agreement. The company will also take part in a dispute resolution process with retailers in early June about the fairness of its wind-down package, following discussions with the Australian Competition and Consumer Commission.
eBay classifieds up for sale
eBay’s classifieds business, including eBay Motors in the UK, is up for sale and could fetch between $8bn and $12bn, reports the FT. Axel Springer, which owns Auto Bild and Business Insider, has already submitted an initial bid. A consortium which includes Hellman & Friedman, which bought the German car classifieds business AutoScout24 for €2.9bn last year, is also believed to be interested.
Closing prices on 22 May 2020 and weekly change
Pendragon up nearly 10% despite 41% of shareholders voting against directors’ renumeration package in AGM on 21 May
Auto Trader Group 521.0p (+19.0p / +3.7%)
Cambria 45.5p (n/c)
Caffyns 280.0p (n/c)
Halfords 166.0p (n/c)
Inchcape 457.4p (-11.2p / -2.3%)
Lookers 18.3p (+0.3p / +1.1%)
Marshall Motor Holdings 103.5p (n/c)
Friday, GFK consumer confidence
Friday, Nationwide house price index
Retailers urged to ‘hold firm’ on used prices
The used car market remains on hold and retailers should avoid a race to the bottom with large downward price adjustments because it would have a “major detrimental impact on the financial health of the industry” says Auto Trader data and insight director Richard Walker.
Used car prices actually grew 0.1% in April, the first since July 2019, as retailers pause price adjustments during lockdown. Mr Walker said there was “absolutely no reason” for retailers to start cutting prices as consumer demand returns.
Plug-in Car Grant appeal win
Retailers with an active appeal for Plug-in Car Grant payments for customer orders made on 11 March, which were not logged on the portal that day, will receive payment, the government has announced. Only claims submitted in March will be allowed and further claims will not be considered.