Will September be a gold-plated month?

  08 August 2016

Nothing lasts forever, and the latest new car registration figures are proof of that. Look past July’s modest 0.1 percent increase and it’s the retail market that’s taken a noticeable hit – it’s down 6.1 percent year-on-year. Contrast that with the five percent rise in fleet registrations and you could be forgiven for thinking that the average consumer isn’t in a rush to replace the family motor.

It would be easy to wheel out the current ‘Brexit’ excuse to explain away the market’s current performance, and there’s more than a grain of truth in the notion that Joe Public might be starting to a catch an economic cold. Of course, September is just around the corner, which would be another perfectly legitimate reason to hold off on any new retail purchase. Despite the growing predictions of more competitive finance packages in light of the recent BoE rate cut announcement, many still put a considerable emphasis on parking a new car with the latest plate on their drive come September. 

The talking heads are describing the current situation as a ‘cooling of the market’ but you could also say it was just a ‘lull’ before the ritual plate-change. Whether the average retailer will ever agree is another matter. Recent financial reports from the likes of Pendragon and Inchcape have been littered with a tell-tale phrase: margin pressures. If it’s not pressure to improve a brand’s CI, it’s shouldering an increase in vehicle stock. Factor in an OEM’s instance to inject a financial contribution to a sale, especially if it’s teetering on the wrong side of a particular market share percentage, and 2016 is shaping up to be a ‘challenging’ year, Brexit or not.

Iain Dooley

Editor, Agenda

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