Month: April 2013

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Confidence slips as business conditions toughen for independent used car dealers

At a glance …

• Independents say business is tougher this year
• They are less confident about the future than last year
• Their stock levels are still too low
• The choice of trade cars is now improving
• Falling values will help profitability

A TOUGHER business climate than 12 months ago is being reported this year by independent used car dealers, according to CAP Automotive.

Confidence about immediate future performance is also slipping, in comparison with the more buoyant mood of independents this time last year.

The trend is revealed by a panel of more than 100 independents questioned by CAP each month in research for Black Book Live, the real-time guide to used car trade values.

A year ago 87% of dealers described the business climate as ‘stable’, ‘good’ or ‘very good’ but a year later this figure has slipped to 74%.

Confidence has also begun to reduce slightly. A year ago 95% of independents expected business to remain stable, improve ‘a little’ or improve ‘significantly’ over the following quarter – but that figure is now 87.5%.

As CAP reported last month, stock levels are also continuing to cause headaches for independent used car dealers. Only 22% are happy with the number of cars on their forecourt compared with 70% who describe their stocks as too low. At this time last year 61% were unhappy with their stock levels.

However, the quality and range of choice of vehicles available in the trade has improved, according to CAP’s panel of dealers. A year ago 66% said they were finding it difficult to source the right cars for their customers but that figure has now fallen to 32%.

Mike Hind, of CAP, said: “Independent dealers are clearly still enjoying success but the climate today is definitely seen as tougher than a year ago.

“The best news in this dealer survey is that independents are finding it easier to source the right cars. That’s a far cry from a year ago, when franchise dealers were struggling so hard to sell new cars that they were competing much harder with the independents to acquire good quality used cars in the open market. The additional competition for stock was causing real pain for independents.

“But even the re-focusing by franchise dealers on new car business is posing problems for some independents.

“Making the finance options on new car deals more affordable than anyone at CAP can remember has enabled franchise dealers to win a lot of new car business away from those independents who specialise in late used cars.

“However, the softening of trade values reported by Black Book Live, after a long period of stable – and even rising – values will at least help ease the pressure on profitability and enable independents to offer their own stronger deals.”


Notes to Editors

Each month CAP questions a 'Dealer Insight Panel' of more than 100 independent used car dealers. The results give a unique insight into the dyanamics of the 'true' used car retail and trade marketplaces. This information assists CAP in its day to day research and is published on the CAP website at for the benefit of customers who wish to conduct peer comparisons with their own business performance.

For further information contact Mike Hind, Communications Manager, CAP on 0113 222 2044 / 07710 152030

Reg number plate applications back up to create Taxing problem

MOTORISTS waiting for a new tax disc after changing their car’s registration plate to a personalised one have been told they should keep their OLD disc on show – even though the registrations won’t match.

Many drivers who have opted for personalised plates are being kept waiting for a new tax disc because of the way in which the DVLA processes applications.

The problem has come about due to the planned closure of local DVLA offices across the UK by the end of 2013.

Drivers are now receiving their new V5C registration certificates before their new tax disc displaying their personalised registration.

But the DVLA is assuring motorists it is acceptable to drive their cars displaying their old tax disc carrying the old number plate on them – despite their cars clearly displaying their personalised number plates and not matching their tax discs.

Notices have been put up in DVLA local offices stating: ‘If you get your registration certificate (V5C) before your tax disc, you can still legally drive your car and display the new registration plates. Your tax disc will arrive shortly afterwards.’

The notice currently being displayed in DVLA local offices
If a car’s number plate does not match the tax disc on display it’s an offence – but the DVLA says that in this instance, motorists will not be breaking the law.

‘We are advising customers who are changing their car’s number plate to a personalised one and have received a new V5C but not their new tax disc to carry on displaying their old tax disc,’ a DVLA spokesperson exclusively told Car Dealer.

‘The two different number plates will match our records and motorists will not be penalised.’

The spokesperson added that all police forces have been notified of the situation. When asked whether motorists could be penalised, the spokesperson replied: ‘That is a matter for the police. We sent out a bulletin informing them – they are aware.’

However, the situation has not pleased a cherished number plate dealer. James Saperia of Simply Registrations told us: ‘It is great that the DVLA is keeping everyone informed of current turnaround times, however we are advising our clients not to fit their new number plates until they are able to display the appropriate tax disc.’

For dealers switching personalised number plates onto new cars, the DVLA suggests car salespeople register cars 14 days before they hand over the car to the customer if possible to get around the problem.

From July, the ‘grace period’ will be extended to 14 days

Source James Batchelor
Car Dealer Magazine – OnLine –

ACFO Turns Spotlight On 'Cradle To Grave' Vehicle Best Practice At 2013 Conference

ACFO Turns Spotlight On 'Cradle To Grave' Vehicle Best Practice At 2013 Conference And The annual Conference and AGM of ACFO – the key event of the year for the UK's premier organisation for fleet decision-makers – takes on a new look for 2013 as it focuses on the cradle to grave life of a vehicle.

Traditionally a forum for discussion on fleet best practice, the 2013 Conference and AGM will be held on Thursday, May 16 at Rockingham Motor Speedway, Corby, Northamptonshire, alongside the eighth GreenFleet Arrive'n'Drive event for fleet chiefs.

This year's Conference and AGM is being sponsored by EDF Energy. The event starts at 09.45am, with registration and light refreshments available from 09:00am.

The Conference theme is 'A Day in the Life of a Vehicle – from birth to end of life' and speakers include:

– Mike Campbell, a procurement consultant specialist at PMMS Consulting Group, who will focus on a vehicle's 'birth' on to the fleet by getting the tendering, procuring and financing of models right.
– Matthew Walter, head of LeasePlan UK Consultancy Services, who will tackle the 'teenage years' including supplier relationship management and adapting to new initiatives and developments.
– Steve Huddart, service, maintenance and repair leader, GE Capital, and John Pryor, purchasing and contracts manager, Arcadia, and an ACFO director, will discuss 'middle age' and issues around vehicle maintenance, fuel management and managing relationships with manufacturers and the independent service, maintenance and repair network
– Finally, the 'twilight years' will see Jim McNally, chairman of the British Vehicle Rental and Leasing Association's Residual Value and Remarketing Committee, and Caroline Sandall, fleet manager, Barclays, and an ACFO director, focus on managing the vehicle defleet process and end of life charges.

During the Conference, delegates will also hear from Kate Armitage, electric vehicle team manager at event sponsors EDF Energy; and Phil Robson, Peugeot's head of fleet.

ACFO director and deputy chairman Damian James, who has organised the speaker line-up, said: "Once again a top quality and highly relevant Conference programme has been compiled, which should be of interest to all fleet decision-makers whether they are professional fleet managers or 'run the fleet' against a background in HR, facilities, finance or procurement.

"The event will provide members and guests with the opportunity to hear the views of experts and obtain answers to key questions to enable them to further improve the operational effectiveness and efficiency of their fleet."

ACFO has a six-strong board of directors and there are two vacant positions arising from the retirement by rotation of Julie Jenner, key solutions manager UK, GE Capital, an ACFO director for 10 years and chairman for seven years, and Brian Ingham.

ACFO finance director Mr Ingham, who will be 65 later this year, is not standing for election. He joined ACFO in 1990 and has served as a director for 10 years having been first elected in 2003.

However, Ms Jenner is offering herself for re-election. Also contesting the election are Julie Summerell, managing director, TR Fleet, who has had a 20-year association with ACFO and is currently Midlands Region chairman; and Richard Baird, head of new business development, Marshall Leasing, who has had a 24-year association with ACFO and is London East Region chairman. The result of the ballot will be announced at the AGM.

Throughout the day there will be excellent networking opportunities for members and guest fleet operators from across the UK.

Following conclusion of the Conference and AGM at about 3pm, delegates will be able to attend the GreenFleet Arrive 'N' Drive event taking place all day at the venue. Driving slots can be booked throughout the day so delegates can get behind the wheel of the very latest low and zero emission vehicle

Reece Somerfield Graduates To G55 In Michelin Ginetta GT Supercup

Double G50 race winner at Brands Hatch, Reece Somerfield is set to make the step up into Ginetta's premier racing class, after swapping his G50, for a G55 as we head to Donington Park for the second meeting of the year.

The 24 year old from Pelsall, West Midlands finished in the top two of the G50 class across the three opening rounds of the Michelin Ginetta GT Supercup over Easter; in the same G50 he raced to third in the G50 cup championship in 2012.

Sensing his ability to challenge for wins in the premier class after finishing tenth overall in a field of 17 cars – beating no less than three G55 racers in the process – in race two at Brands Hatch, Somerfield elected to progress into the higher class early on in the season, to ensure the best possible start to his G55 career.

Having been presented with the coveted 'Spirit Of The Championship' honour at the Ginetta Awards Dinner in January this year, the Forkers Civil and Ground Engineering backed driver said; "I loved racing the G50 Cup car, however, at the end of last year and the start of this, I found myself running amongst the back end of the G55 field, in what was essentially a less powerful car. Therefore, I began to think 'I wonder what I could be doing in the G55', so, hopefully, this weekend we will find out."

Max Gregory, Championship's Manager said; "Having learned his racecraft in the G50, Reece showed promise in 2012, earning some great results in the latter part of the season and finishing third in the championship. It makes sense for Reece to switch to the G55 early on in the season so he can really challenge for championship points. We are looking forward to seeing how he gets on this weekend."

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For more information please contact:

Ruth Harrison
Ginetta PR
T: 0113 385 4165
E: [email protected]

BVRLA Reaction To IPPR Report On Ultra-Low-Carbon Vehicles

The BVRLA has welcomed the publication of a new independent report from the IPPR think-tank on how the UK can grab the full opportunity presented by ultra-low carbon vehicles. The association was consulted during the drafting of the report and was particularly interested in its comments on the removal of 100% First-Year Allowances for lease cars:

3.1.3 Support for Leasing and Rental Companies:
Many interviewees argued that the key to promoting ULEV uptake lay in supporting leasing and rental companies, partly as a means of allowing the public to gain experience of ULEVs.

Most cars and vans are bought through some form of leasing or rental company. In 2011 58 per cent of new vehicle registrations were made by businesses, and of these registrations over 90 per cent were part of a fleet of 25 vehicles or more (SMMT 2012a).

In the fourth quarter of 2011, 74 per cent of fleets had vehicles financed on a contract hire basis, 22 per cent had vehicles financed on an ad hoc hire basis, and 19 per cent of fleets had vehicles financed on a finance lease basis (Experteye 2012). Furthermore, 66.5 per cent of consumers used either hire purchase arrangements or personal lease arrangements.

Therefore the changes made in the 2012 budget, which removed the availability of enhanced capital allowances for ULEVs to leasing and rental companies, have had a serious impact on the fiscal incentives available to support ULEV uptake, particularly by public sector bodies.23 IPPR has been told that the removal of the availability of 100 per cent first year capital allowances to leasing and rental companies could add 3 to 5 per cent to the cost of a car lease, or up to £15 per month on a £300 per month lease. For a fleet of 25 ULEVs financed over a four -year period, this adds a total of £18,000 to the cost of that fleet of ULEVs.

We recommend that the government immediately reinstate the 100 per cent first year capital allowance availability for leasing and rental companies.

Commenting on the report, BVRLA chief executive, John Lewis said:
"We are delighted that this independent report has recognised the vital importance of the vehicle rental and leasing industry in driving the uptake of ultra-low emission vehicles, something that the government has chosen to ignore.

"We will continue to lobby for them to reinstate 100% First Year Allowances for our sector. Sales of new ultra-low carbon vehicles will not progress as everyone wants them to unless this happens."

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For more information please contact:
Toby Poston
Head of Communications, BVRLA
T: 01494 545700
M: 07979 756533
E: [email protected]

March plate-change posts 5.9% growth in new car registrations

New car registrations increased by 5.9% on the back of the plate-change month of March to 394,806 units.

The latest figures from the Society of Motor Manufacturers and Traders (SMMT) show the UK has posted 13 months of growth in a row and registrations increased by 7.4% over Q1 to 605,198 units. Private registrations increased by 11.2% over Q1 and the majority of registrations were private, taking 204,299 units out of the March total.

Volumes for March are still some 12.1% below the 2007 pre-recession market total, but it is the best result since the 2010, when more than 50,000 cars were registered through the scrappage scheme.

Adjusted for total selling days, CAP believes the increase in March figures is more like a 9.6% increase. Dylan Setterfield, CAP senior forecasting editor, told AM on Twitter: "Some say retail demand is steady, others that it has fallen drastically. Not grown 10%!."

Andy Barratt, Ford sales director, told AM: “Our retail performance was particularly encouraging. The market can be fragmented with short-cycle rental and pre-registration activity be we really don’t participate with that.

“The dealer network really dug deep for the performance.”

Mike Baunton, SMMT interim chief executive, said: “UK new car registrations out-performed expectations in March, the first month of the new 13-plate.

“Despite ongoing economic concerns, consistent monthly growth in the market is an encouraging sign of returning consumer confidence as motorists are attracted to forecourts by new models and the latest technologies.”

New car registrations continue to grow in key March market, with demand for 13-plate cars up 5.9%

The Q1 outturn was 2.7% above SMMT’s forecast, which could lead to the market exceeding SMMT’s 2.057 million unit full year outlook.

However, trading conditions remain challenging, given the subdued wider economic setting.

The SMMT believe the market’s growth over the past 13 months has been supported by increases in private registrations, although all sales types reported growth in March and Q1 2013.

Registrations of petrol-fuelled cars rose by 12.1% so far in 2013, outselling diesels. This has been spurred by growth in the small car and private sector markets. Registrations of alternatively-fuelled cars dipped in the month, but rose by 2.9% in Q1.

The mini segment again showed the strongest growth in March, up 56.5%, due to the success of new models.

Double digit gains were also reported in the MPV and dual purpose segments. All segments, except upper medium and luxury saloon, grew in March.

The Ford Fiesta was the best selling model in both March and Q1.

Mark Ovenden, Ford of Britain managing director, said: "Vigorous consumer demand is driving up our share of more profitable retail sales thanks to our latest range of vehicles and the UK’s strongest dealer network."

Sue Robinson, director of the RMI National Franchised Dealers Association (NFDA), said: "It is positive that new car sales were up in March as retail demand continues to grow.

“Dealers reported strong interest in news cars by consumers who were encouraged into the showroom by strong manufacturer deals and competitive finance offers.

“Although consumer confidence remains sluggish there are signs that it is starting to grow. The NFDA are hopeful that this is a trend that will continue through 2013."

Winners and losers

Ford took the lion’s share of the March market with a 14.44% share, an increase of 1.62% to 54,702 units.

Mercedes-Benz has a strong month with a 15.53% increase to 18,870 units boosted by the new A-Class and order books were also open for the new CLA. Honda also posted a positive increase of 23.06% in March to 12,471 units with the help of low rate finance offers on the Civic.

Marcus Breitschwerdt, president and CEO Mercedes-Benz UK, said: “More new and returning customers than ever before a

Ford Focus eclipses Toyota Corolla as world’s best selling car

FORD’S FOCUS is officially the best-selling car around the world, R.L. Polk & Co have revealed.

The mid-sized family hatchback has just been named the best selling car in the world, according to figures released by the US automotive research company.

Ford managed to shift 1.02 million of them globally in 2012, comprehensively outselling its nearest rival, the Toyota Corolla, which has traditionally dominated global sales rankings.

Ford’s success is largely down to its ‘One Ford’ policy, in which a single model is designed to cater to the tastes of customers in markets across the globe

source: Car Dealer . Newsletter – April 12 2013

BCA say that lack Of Stock Continues To Fuel Used Car Values….

British Car Auctions used car data for March 2013 shows year-on-year values up sharply

The latest Used Car report from leading vehicle auction company, British Car Auctions (BCA) shows that year-on-year values were up by over 17% in March, although prices declined marginally – by 0.7% – when compared to February 2013. For the fourth month running, average used car values remained at £7,000 or more as the market continued to be short of retail quality stock.

Across the board used cars averaged £7,000 last month, down by £56 compared to February but significantly ahead of March 2012 by £1,026 (17.1%). March 2013 recorded the fourth highest average monthly value since BCA’s reporting began in 2005. However, post-Easter, BCA has seen buyer demand weaken with conversion rates falling in the first week of April, suggesting there will be some pressure on values in the weeks ahead.

Simon Henstock, BCA’s UK Operations Director commented: “Although average values continue at near record levels, prices are high largely as a result of the constricted supply rather than strong demand. We also saw pressure on conversion rates in March, with a notable reluctance for trade buyers to bid as strongly on poorly presented vehicles. Values for cars requiring any significant degree of cosmetic work were hit the hardest. In contrast, values for well-presented retail quality vehicles continue at often exceptional levels, outperforming price guide expectations by a considerable margin.

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Madeleine Roles / Wendy Harrison / Louise Fowler
T: 020 8977 9132
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New car finance up 31% in February

The number of new cars bought by consumers using dealer finance grew by 31% in February 2013 compared with same month in the previous year, according to the latest figures from the Finance and Leasing Association (FLA).

FLA members’ penetration of the private new car registrations market was 71.9% in the 12 months to February 2013, up from 64.5% in the year ending in February 2012.

The consumer used car finance sector also saw an increase of 7% compared with February 2012.

Paul Harrison, head of motor finance at the Finance & Leasing Association, said: “The new car finance market was strong in February and again outperformed the growth in new car registrations.

“This shows the importance of point-of-sale credit to the UK automotive industry, employment and the wider economy.

“The Government must make sure that its new regulatory regime for consumer credit maintains a competitive marketplace and supports the continued availability of affordable credit for customers.”

Despite the increase in February, one dealer suggested that while offers were tempting buyers into the showroom they were not profitable deals, with a "huge increase in manufacturers sacrificing dealer F&I earnings" with low rate PCP deals.

sourced: AM-Online

To address your F&I department staffing needs contact Ross Lebeter on 07920 746 022 or email [email protected]

Dealer Profitability Improves

Average dealer profitability improved from 0.7% return on sales in January 2012 to 1.17% over the same month this year, according to the latest figures from ASE.

Mike Jones, ASE chairman, said that while the absolute result is a small profit, the rolling 12 months average return on sales has crept up again to reach 1.17%, a further increase on the record result in 2012.

The cause of the improved performance continues to be new vehicle sales, with volumes remaining strong.

There is also some optimism in used vehicle sales, with return on investment stabilising at 85%.

Stockturn has, however, crept up which could leave some dealers with stock write-downs if new vehicle offers continue to become more attractive to move metal.

Jones said: “Vehicle sales expenses as a percentage of the department gross profit has continued to improve slightly, with most dealers reporting an increased level of sales per salesman.”

“The decline in aftersales overhead absorption has also stabilised with dealers working hard to maximise service profitability while most of them have been facing declining vehicle parcs.

“The increased sales levels in 2012 will lead to a reversal of this trend however it is likely to be 2014 before this increase produces a noticeable increase in service department sales.

“An indication of overall performance will become clearer once we receive the data for the key month of March given the significant increases in volume targets for most brands, however 2013 has started well.”

sourced from AM Online.

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