MAKE MORE MONEY FROM AUTO RETAILING OCTOBER 2020
ISSUE 69
Card machine scams on the rise Fraudsters are targeting credit card machines – here’s how to keep them out and protect your profits SEE PAGE 4
PCP – THE USED MARKET SAVIOUR? Why personal contract plans are at the core of a strong future for the used market SEE PAGE 16
CHARITABLE BENEFITS How Gravells Kia Narberth has helped themselves by helping others in testing times SEE PAGE 10
BEST PRACTICE
DATA
ACTION PLANS
LEADERSHIP
MAKE MORE MONEY
Noteshe from itng meet room
EDITOR Tom Webster tom@auto-retail.com t: 07776 303555 PRODUCTION EDITOR Trevor Gehlcken gehlcken@hotmail.com t: 07747 787403 EDITORIAL DIRECTOR Tristan Young tristan@auto-retail.com COMMERCIAL DIRECTOR Francis Marshall francis@auto-retail.com t: 01572 724 687 OFFICE MANAGER Rosalind Marshall ros@auto-retail.com DATA RESOURCE MANAGER Frances Tatlow ftatlow@auto-retail.com ACCOUNT MANAGER Caroline McBain caroline@auto-retail.com FINANCE MANAGER Angie Wilderspin angie@auto-retail.com PRODUCTION AND MARKETING ASSISTANT Pippa Gunter pippa@auto-retail.com MANAGING DIRECTOR: Rupert Saunders rupert@auto-retail.com CHAIRMAN: Fred Maguire Published by: Automotive Retail Ltd 21 Midland Court, Station Approach Oakham LE15 6RA t: 01572 724 687 w: www.auto-retail.com Reproduction in whole or part of Auto Retail Profit without the permission of the publisher is strictly prohibited
MAKE MORE MONEY FROM AUTO RETAILING OCTOBER 2020
ISSUE 69
Card machine scams on the rise Fraudsters are targeting credit card machines – here’s how to keep them out and protect your profits SEE PAGE 4
The hot topics shaping the agendas of those at the forefront of the automotive retailing industry
Meeting chaired by: Sam Watkins, chair, Vehicle Remarketing Association Why was the meeting called and who was in attendance? This was the VRA’s sixth member webinar since the start of the coronavirus crisis. The others have concentrated on different aspects of how the situation was affecting our sector but this one was different, looking at the wellbeing of members and how they have coped with the last few months. What was top of the agenda? We had presentations from two invited speakers – Prash Kotecha, a wellbeing expert from Mantra Consulting, and Rachel Clift, health and wellbeing director at automotive industry charity Ben. Also, two VRA members discussed their experiences – Darren Martin of cap hpi on his battle against prostate cancer and James Davis of Cox Automotive on the stigma of mental health in the workplace.
Fact file Company: Vehicle Remarketing Association Principal business: The VRA represents companies involved in all aspects of remarketing used cars which between them handle, sell, inspect, transport or manage more than 1.5 million used vehicles every year
Sam Watkins What was decided as a result of the meeting? It was a meeting designed to inform rather than create any concrete outcome but we certainly plan to maintain an interest in member wellbeing as the crisis continues. Any other business? The webinar was also briefed about some sponsored events in which members are taking part and we also asked members to donate to the Macmillan Coffee Morning appeal, which is currently underway. When is the next meeting, and what is it about? We are planning to hold our next VRA member webinar in October or November and will return to our usual format, with briefings from a variety of industry experts on subjects such as the used car and van sector, retailers, auctions, vehicle preparation and movement, legal and compliance updates, and more.
PCP – THE USED MARKET SAVIOUR? Why personal contract plans are at the core of a strong future for the used market SEE PAGE 16
CHARITABLE BENEFITS How Gravells Kia Narberth has helped themselves by helping others in testing times SEE PAGE 10
BEST PRACTICE
DATA
ACTION PLANS
LEADERSHIP
ISSN 2515-5679
SUBSCRIBE Tel: 01572 724687
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We want to hear from YOU! At this unprecedented time for the automotive industry, and the country, it is more important than ever that we stay in touch. We want to hear what you are doing to keep connected with your customers, keep your staff happy and healthy and how you are keeping money moving in your businesses. Email Auto Retail Profit’s Editor Tom Webster at tom@auto-retail.com
www.auto-retail.com | Oct 2020
NEWS
Vertu’s £2.4m upgrade complete l Farnell Land Rover Bradford renovation complete l £2.4m invested in total l New senior team appointed Farnell Land Rover Bradford has completed a full renovation that brings about a new workshop, 50 spaces for used cars and electric charging points and more. It also gets a new senior management team to lead the new-look retailer. The site, which is on King’s Road in Bradford, features an 11-bay workshop, MOT area, space for 50 used vehicles, dedicated customer parking, a handover and a selection of charging points to cater for Jaguar Land Rover’s recently launched plug-in hybrid models. Inside there is a barista bar and the showroom is fully air conditioned. The other crucial change is the appointment of a new senior management team to push the business forward. John Steele is the new head of business and brings more than 25 years’ experience to the role. He is also head of business for Gordon Lamb Chesterfield Land Rover. He will work alongside Simon Davis who is now brand manager, having joined as general sales manager five years ago. He was named sales manager of the year in 2017 in the Vertu Motors annual CEO Awards. John Steele said: “I
John Steele
www.auto-retail.com | Oct 2020
am pleased that we can now showcase the new Farnell Land Rover Bradford retailer. “This was a significant investment for the group and has demonstrated confidence in Bradford and its economy. Farnell Land Rover Bradford is home to some superb luxury cars, and I know our customers will be thrilled with the equally prestigious site.”
TALKING POINT How can barista areas be used effectively in Covid-19 times?
Toyota’s new UK boss l Agustin Martin Toyota GB’s new president and MD l Takes on the role from 1 October l Replaces Paul Van der Burgh Agustin Martin is taking on the role of president and managing director of Toyota GB as of 1 October. He is replacing the Paul Van der Burgh who is retiring from the company. Agustin moves to the position from that of CEO of Toyota Connected Europe and vice president of connected technologies of Toyota Motor Europe. However, he has a long history with Toyota Motor Europe (TME), having joined in 1995. He has served as a product planning general manager, marketing director for TME and as president and CEO of Toyota Spain from 2015. Paul Van der Burgh held his role as president and MD from 2015, having previously worked in roles including marketing director, and director of
Agustin Martin Lexus. He plans to move to Northumberland “to enjoy life to the full in one of the most beautiful parts of the world.” Dr Johan van Zyl, president and CEO of Toyota Motor Europe, said of the change: “I would like to thank Paul for his great contribution to the success, and particularly the transformation of, Toyota GB over what has been a period of rapid change in the industry. “I am sure Agustin is a very worthy successor and will use his experience, especially in mobility and connected technologies, to keep Toyota GB at the forefront of customer satisfaction.”
TALKING POINT What role does a company boss play in a retailer’s satisfaction?
Stoneacre adds three sites l Stoneacre buys three northeast retailers l Hodgson Motor Group bought out l Sites in Gateshead and Newcastle Stoneacre has bought three retailers in the north east, acquiring Hodgson Motor Group’s Toyota, Mazda and Suzuki franchises. The sites, based at the Metrocentre in Gateshead and Silverlink in Newcastle, came available as the owner, Steve Hodgson, has retired following
a 30-year career. Stoneacre plans to retain the 180-strong team. Managing director Shaun Foweather said: “Steve has developed a great reputation with customers and has a high level of staff loyalty. He is leaving the business in great shape and creates a fantastic opportunity for Stoneacre to grow it further.”
TALKING POINT Can a family feel be replicated in a bigger company?
Manheim allows buyers back l Manheim lets buyers inspect cars again… l…but auctions remain online l Online buying fees still waived Manheim has taken a step towards reopening physical auctions, by allowing buyers to inspect vehicles again. Rather than simply restarting physical auctions, though, the company will let buyers book viewing appointments to look at the cars. These appointments will either be the day before a car is auctioned, or in the morning if it is due to go through an evening sale. The actual auction will still be conducted online, as has been the case through the lockdown. All viewings will be ‘Covid secure’ says Manheim. The company is also continuing to waive online buying fees. Liam Quegan, Manheim Auction Services managing director said: “Buyers have adapted well to online-only sales, but some will value the ability to view stock in person.”
TALKING POINT Are there certain types of vehicle that merit inspection more than others?
@autoretail | 3
MAKE MORE MONEY
Why a PDQ machine cyber-attack could cost hundreds of thousands The card-machine is not a new point of attack for criminals, but fraudsters are getting even smarter
~ The fraudsters enter a site with the aim of distracting staff, normally at a weekend
AUTHOR Name: Lee Cohen
A
n increasing number of motor dealers have suffered significant financial losses from credit card fraud, following the fraudulent use and/or theft of PDQ machines (PDQ standing for Process Data Quickly – they are more commonly known as creditcard machines). These fraudsters are not always behind a computer; they prey on motor dealers operating with less staff than normal, taking advantage of their vulnerability. Motor retailers, large or small, operating with a reduced workforce following Covid-19, need to be aware of this threat. The losses might not be as big as some other forms of cyber-crime, but they are notable. We know that one of our partner companies has had a dealership client with over £400,000 of losses, we have a client that has lost £120,000, and quite a few have been hit to the tune £50,000 and those are the ones we know about. That can make the difference between profit and loss in a month and particularly at a tough time such as this.
Position: Managing director Hamilton Leigh E: leecohen@hamiltonleigh.com T: 020 8236 5367 Lee has worked in insurance since 1981 and co-founded founded Hamilton Leigh in 1987
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How does it happen? The PDQ attack method has been relevant for the last month or so and it is incredible how many are being hit. The fraudsters enter a site with the aim of distracting staff,
normally at a weekend. While they skilfully distract members of staff, their accomplices locate and manipulate the card machine by refunding substantial amounts of money onto their card(s). We have also seen examples of PDQ machines being stolen and used fraudulently as well as machines being switched between dealer groups. Again, the criminals have entered a site, processed a lot of credits, and then stolen the machine and somehow processed more credits off site. When they steal the machine, they have replaced it with another one, possibly from another site where they had maxed it out. That buys them more time before they get found out as no-one spots the machine is missing in the immediate aftermath. The theft can be in the form of lots of smaller credits – £400500 – or a few thousand at a time. Some didn’t have any limits on how much could be refunded at all. Distraction techniques are not a new phenomenon. However, with more sophisticated payment technology available the use of card devices seems to be an increasing trend for fraudulent activity.
How can you prevent this from happening? l Encourage your staff to treat the PDQ terminal like a till – always ensure you are in control of transactions and keep the terminals in secure areas; consider them as mini cash dispensers
l Install additional security measures on these devices to prevent refunds from being processed without specific authorisation l Be wary if someone is taking longer than five to 10 seconds to type in their PIN, or if someone else is trying to get your attention during this time l Protect yourself with a robust cyber insurance policy as standard business insurance policies do not provide cover for fraud. This type of fraud will only be covered under a specific cyber insurance policy. We have seen a huge increase in cyber-attacks on the motor trade sector and I fear the frequency of these attacks will only increase. Cyber insurance can be challenging to understand as all policy wordings are different but www.auto-retail.com | Oct 2020
CYBER SECURITY
the most important feature is insurers’ ‘incident response’. This service has proved invaluable for those businesses unfortunate enough to have suffered an attack. We know of one case where a retailer was attacked last year. They didn’t take cyber insurance as it wasn’t in their budget at the time and then they got attacked. They then bought it and two months later they were attacked again. The key is the incident response. This client will openly admit that if they didn’t have access to that insurers’ incident response service then they would have been out of business. They reacted within an hour. In this instance it was a malware that infiltrated bit by bit – they noticed the functionality changing, they notified us and within an hour they were able to tell them what www.auto-retail.com | Oct 2020
was going on. They shut it down, built a replicate system, so they could keep going. This client is not a small business and, as with most cyber-attacks, their IT team didn’t have a clue what to do. This is particularly the case when the PDQ machines are hit – it is an area of the business that doesn’t always fall under the IT team’s remit. One major dealer group got attacked and their financial director didn’t know what sort of security they had on the machines. Those that have been hit by PDQ machine attacks have reacted in different ways. In one case, the only way they can now process any refund is in their accounts department, which is a back-office function in a secure area. Other companies are now applying max transaction limits,
others are saying they are not taking credit cards at all. Others are doing a mixture of those. Above all it is an educational task that these are mini cash tills. l Your insurance should be your last line of defence. Improved Cyber procedures and controls should be your first priority however should you wish to discuss Hamilton Leigh’s bespoke Cyber Liability Insurance for motor dealers, please contact Jason Cohen on 07511 398238
YOUR ACTION PLAN n Educate staff to treat card machines like small cash tills n Make sure there are maximum refund limits n Consider only processing refunds in a back office n Make sure staff are wise to distraction techniques
@autoretail | 5
MAKE MORE MONEY
Retailer satisfaction on the The latest NFDA survey spells bad news for Hyundai, but others are satisfied with the help they have got during the pandemic
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t a testing time for retailers, it will be of reassurance to many that relationships with manufacturers have, on the whole, not suffered during the pandemic, at least according to the latest NFDA Dealer Attitude Survey in any case. The average score that retailers award their manufacturers overall has risen to 6.0/10 – up from 5.9 in January and 5.6 from the same time in 2019. However, this upward trend isn’t universal. While those who have enjoyed positive ratings in recent times have maintained or improved their scores (six of the top seven have seen their score go up or
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remain stable) it is a different story down the bottom of the table.
Poor performers and dropping scores The bottom five manufacturers all saw their scores worsen versus the same survey six months ago. Hyundai retailers in particular have slated their manufacturer, with 83% of the network responding to rate the brand overall with a score of just 2.5, down from 3.2 six months ago and planting it firmly at the bottom of the table. A year ago, it ranked 14th with an above average score of 6.0. The miserable score six months ago had come just after retailers issued an open letter of complaint to Hyundai UK boss Ashley Andrew. Retailers said that Hyundai had been making the job of selling cars, and hitting targets, ever more complex, which had reduced dealership profitability even though volumes and customer satisfaction had been maintained. At the time, a Hyundai spokesperson said that Andrew had responded to the open letter and was addressing some of the specific points raised. Clearly very little has changed, and retailers are now questioning whether Andrew has the level of seniority required to fight their corner. Hyundai, though, was not the fastest faller in this iteration of the survey. That dubious honour goes to Subaru with a drop of two points to 4.6, although this is perhaps unsurprising given the fall-off in sales this year and the lack of lowemission cars in the range. Second fastest faller was Jaguar, losing 1.6 points to 3.7 and seeing its position drop to fourth from bottom. This contrasts with Land Rover, whose
score rose 0.7 points to 5.5, albeit still below the average.
The best of the rest The star performer and fastest riser in this iteration of the survey was Mini, with an increase of two points taking it to fifth in the survey. It has been two years since it enjoyed a top five position, and for the previous two surveys it has languished mid table. Sister brand BMW also increased its score and improved its position, showing a steady improvement after its disastrous results 12 months ago that saw it in 28th position in the table. There were mixed results within the former PSA brands of the newly merged Stellantis group, with Peugeot dropping back after its stellar performance six months ago, but Citroen improving notably. In January, Peugeot saw its score increase from 6.9 to 7.8, bringing it to fifth in the table. In this latest
www.auto-retail.com | Oct 2020
NFDA SURVEY
up, unless it’s with Hyundai
www.auto-retail.com | Oct 2020
forth between second and seventh/ eighth. This for a brand that held the top position in the table for five consecutive surveys between January 2015 and January 2017, and which was in the top two for eight surveys in a row. While there are high levels of satisfaction among Mercedes retailers in many questions of the survey, there is particular concern in areas such as profit return (with a score of 5.4 down from 6.6 in January), margin (down to 5.4 from 8.0) and bonus and rebate rates on new car sales where it scored just 5.5, down from 7.8 six months ago.
Covid-19 rated Retailers also rated the help provided by their manufacturers during the height of the Covid-19 pandemic. Lexus, Toyota and Kia came first, second and third respectively in this new chart. (The same three brands also took the top three places in the ‘How do
you rate your manufacturer overall’ question, albeit in a different order). Retailers returned an average score of 6.4 points out of 10 in this area. Lexus (9.6), Toyota (9.5) and Kia (8.9) were the top performers, while dealers gave the lowest scores to Vauxhall (4.0), Fiat (3.9) and Hyundai (2.7). Commenting on the results of this latest Dealer Attitude Survey, which had a record response rate of 60.1%, NFDA director Sue Robinson said: “It is encouraging that most dealers were fairly satisfied with the support received during the pandemic from their manufacturers. Overall, current profit return and return on capital remain key concerns for many retailers. “Looking at the future of the market, it is encouraging to see that most dealers are satisfied with their alternative fuel vehicle offering and that average satisfaction levels in this area continue to rise.”
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survey it has lost some of those gains, its position slipping back to eighth with a score of 7.2, although this is still well above average. In contrast, Citroen, with a new MD at the helm, has seen its score increase from 4.9 to 6.2, bringing it to 13th in the table. This continues the steady improvement of the brand which ranked 30th just 18 months ago. Both of these show a stark contrast with FCA sibling brands within the newly merged group, with Fiat, Alfa Romeo, Abarth and Jeep occupying four out of the bottom seven positions. Mercedes, on the face of things, has fared well in this most recent survey, with a very respectable score of 8.0 putting it fourth in the table. But this is down from 9.2 in January when it ranked second, and maintains the up and down picture from the previous four surveys where it lurched back and
Hyundai retailers said that Hyundai had been making the job of selling cars and hitting targets, ever more complex
@autoretail | 7
PARTNER FEATURE
How to survive the MOT bottleneck E THE AUTHOR
Name: Jeremy Evans Position: Managing director, Marketing Delivery
~ It is important that dealers manage customers’ expectations and encourage them to book in as early as possible
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arlier in the year the UK Government approved a six-month MOT extension for all vehicles with an MOT due between 30 March and 31 July 2020. This was a practical measure to facilitate social distancing during the lockdown period, but it will result in increased demand for MOTs from September onwards. For dealers that are already wading through a backlog of sales enquiries, this provides yet another challenge to overcome.
A busy time for dealers, made busier Naturally there will be an influx of new MOT business as the extension draws to a close. Coupled with significant numbers of naturally expiring MOTs, the typical number of service bookings, and anticipated high demand around the September plate change, and dealers could face a bottleneck as they deal with high volumes of sales and aftersales enquiries. To stay ahead of the curve, it is important that dealers manage customers’ expectations and encourage them to book in as early as possible. Electronic customer relationship management (eCRM) tools allow dealers to automate much of the communications process, sending relevant, personalised messages to the right customers at the right times. Our earlier research suggests 60% of motorists are more likely to book a service or MOT
with a workshop that reminds them at an appropriate juncture. Programmatic email campaigns make this effortless. Workshops can also enhance their ability to retain aftersales custom by putting processes in place to capture a customer’s full contact details. Recent Marketing Delivery data indicated that 21% of dealers’ aftersales customer records don’t include an email address; 11% didn’t include a mobile phone number. Opening communication with customers a suitable amount of time before their MOT is due won’t just help dealerships to maximise their workshop utilisation, it could also help customers avoid a situation where they forget their MOT has lapsed.
MOT marketing Marketing Delivery is also launching a new aftersales service to help dealers address any
weaknesses in their data collection. Called MOT Box, the new system is designed to help those dealers struggling with an aftersales bottleneck, cross-checking customer vehicle data against the DVSA’s MOT database to fill gaps and address inaccuracies. Automatically identifying potential MOT customers at the click of a button, MOT Box effortlessly helps aftersales staff to create a tailored programmatic email campaign, targeting all customers with vehicles over three years old. This is another example of how automated, digital systems can save dealers a significant amount of time. It is crucial that dealers now use this opportunity to ‘think digital’, and unlock the possibilities that it offers. Many workshops could, in fact, find that automated aftersales interaction could be the competitive differentiator that sets them apart. www.auto-retail.com | Oct 2020
PARTNER FEATURE
Cashflow is ‘critical’ as businesses plan updates T
www.auto-retail.com | Oct 2020
are key modules of Mazeinsight, our business intelligence software that enables you to harness the power of your data.
Accurate reporting After the flurry of new car sales activity in September, it will be the reporting structure you have in place for Q4 that will enable you to monitor cash flow and avoid any potential pitfalls to the year end. Not only that, having the right tools in place to fully understand and use your business data will give you a competitive advantage. Business intelligence software that delivers actionable insights in a format that is quick and easy to understand will enable you to react to a rapidly changing market. The Cox Automotive survey found 79% of retailers were changing their business plan for 2020 and advised that dealers should have a three-month rolling operational budget which they should revisit as a priority. These are sound business sentiments which we totally endorse. But, as we all know, producing
repeatable, accurate and consistent plans from multiple data streams on a regular basis is not as easy as it sounds. We are all familiar with Excel as a planning tool but many of us will also be aware of its limitations when it comes to data validation and consistency; errors can easily creep in.
A single view Mazeinsight offers Excel functionality but works behind the scenes to gather inputs from multiple sources, not just your DMS. It gives you, and your management team, a single view of performance, allowing complete end-to-end management of your business with confidence and security. As fellow operational professionals, we understand Q4 will be critical to the motor retail industry. Whether you are working on cashflow reporting, or any one of the many other datasets we all use these days, it’s vital you base your actions on insights that are accurate, current and gathered from across the business.
THE AUTHOR Name: Tracy Ellam Position: Commercial director, Mazepoint
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he old slogan ‘cash is king’ no longer applies to the motor retail industry; but it is certainly true that ‘cashflow is critical’. A recent survey by Cox Automotive rated cashflow as the second most pressing concern for motor dealers (just behind the health and welfare of staff and customers) while dropping sales volumes was the third. And, in the wider market, UK Finance, which represents the banking sector, found that a fifth of small firms had less than one month’s cash reserves left during lockdown. Of course, the motor retail sector is used to running with debt (just think of all that stock funding) and, to a certain extent, the crisis has been mitigated by generous government support and broadly supportive banks. But what will happen as those support packages begin to be removed and we start to operate in a normal commercial environment again? Reporting on cashflow, and the wider science of annual budgeting,
Reporting on cashflow, and the wider science of annual budgeting, are key modules of Mazeinsight, our business intelligence software @autoretail | 9
MAKE MORE MONEY
Kindness provides a boost to G
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Do you have to be ruthless to sell cars? Gravells Narberth shows that being kind can help bring in customers
We started ‘Tinman Tuesday’ collecting tins from the houses in the village and did a drop off in the food bank
Ian Gravell gets hands on with food parcel distribution
S
uccess over the last six months has taken on different meanings to many different people. While the financial boost of the post-lockdown period has been a boost to many, others have rightly taken also solace from other positives in 2020. Gravells in Narberth has discovered that an altruistic approach has paid back in more ways than one, with the retailer having thrown itself wholeheartedly into working with and for its community in lockdown. Ian Gravell, general manager of Gravells Kia in Narberth, explains the lockdown-enforced closure brought about a determination to keep busy and give something back to the community. He started by joining in with local food drives for those that needed them. “I noticed that several Round Tables were doing food drives,” says Ian. “I spoke to the local one, went to a local cash and carry and got a
favourable rate and put together parcels for deserving people and we ran that for about six weeks. We did it about two or three times a week and we made sure they went to the right places.” The team was able to ensure that the food went to those that needed it by working with the Trussell Trust. Despite not having known the organisation before, Ian says he has built a close relationship with the charity through the efforts made. It helped galvanise a small team, too, at a time when the company was off work and on furlough. Some would help out with putting the donations together. “Sometimes as many as eight people were preparing the parcels, sometimes it was just me, it was a welcome thing. When your purpose is stopped you have to find something to do.”
Proactive collections In addition to creating their own
parcels, Ian and some neighbours also took a more proactive approach. “We also started ‘Tinman Tuesday’ collecting tins from the houses in the village and did a drop off in the food bank,” he says. The small team marked up a Kia Sorento with ‘Kia Kindness’ stickers and went around door to door, spreading the word via social media and word of mouth. It has spread to such an extent that ‘Tinman Tuesday’ now operates in 15 different locations across the county, all run by volunteers. “People got more involved as time went on. Down in a village near us they had a girl dressed as Dorothy from Wizard of Oz for the collections,” says Ian. He explains that the collections now take two people around an hour and a half to do, and that a colleague has developed an app so people can mark down where they live so the team knows where to call. “We do go on spec to be on the safe side. Some kids would put a can of beans out and it would be like Santa hasn’t come if it isn’t collected,” he adds.
Profile boost As well as the boost to the local community and the food bank supplies, Ian says that Gravells’ involvement with the scheme has raised his profile in the community hugely. Tinman Tuesday has featured on Welsh radio, Welsh TV, local media and has been pushed heavily on social media. Ian also says that he was contacted by a local MP and the chief executive of the county council, and the local government has sent a TV crew to film a piece to appear on its social media. Above that, and more importantly, Ian says that it has been mentioned by a huge number of customers that are coming
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www.auto-retail.com Oct 2020
SUCCESS STORY
Gravells morale and sales bank through the door. Although it is hard to put any kind of numbers on it at the moment, he reckons that it has definitely brought in sales and thinks that they have had a better return post lockdown than local retailers that weren’t involved. One action definitely led to a sale, though. While scrolling through Facebook in lockdown, Ian noticed that a local Covid nurse was without transport after her car broke down. Within three hours he had
Fact File
met up with her and offered the use of a courtesy car that was otherwise doing nothing. When
lockdown eased and the nurse was able to replace her car, she opted for a Gravells Kia.
Established in: Gravells was founded in 1932, Narberth opened in 2010 Staff numbers: 13 in Narberth New cars sold in the year to August 2020: c.350 Used cars sold in the year to August 2020: c.350
Harness the power of your data For fast, accurate, decision-making to improve your bottom line What’s the month looking like?
What are the numbers like today?
How close to forecast are we? Can you answer these instantly at the touch of a button?
Mazeinsight brings together all of your datasets to create a single view of your performance, accessed from your own dashboard. Configured with your KPIs, the data gives clear insight to drive the bottom line. The system is unique – it allows the data to be sliced and diced for any ad-hoc analysis. Mazeinsight provides end-to-end business management at the touch of a button.
For peace of mind, all Mazepoint solutions comply with ISO information security and quality standards
Call us now
on 0207 348 7600 or Tracy Ellam on 07375 675384 www.mazepoint.com www.auto-retail.com | Oct 2020
@autoretail | 11
MAKE MORE MONEY
PARTNER FEATURE
Leaving nothing to chance with a customer renewal appointment THE AUTHOR
Name: Steve Fitzgerald, Chrysalis Solmotive
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Because you do not want to be going over old ground with the customer when they are with you, ensure deals are already put together
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E
ven in a highly professional environment it is easy to overlook small details. For example, a topflight customer contact strategy can still fail to deliver appointments because minor steps are overlooked at the last minute. Here we spotlight the attention to detail that best ensures a customer renewal appointment will result in a sale. Identifying the most receptive potential leads, using Key2Key’s insights into the status of each customer, is just An email works, but nothing beats a call the beginning. Here a ‘joined up’ approach pays, maintain this discipline. which means coordinating with With the meeting agreed your existing stock situation, rather leave nothing to chance, such than simply aiming for another as assuming the customer will sale. For example, this may mean remember. A follow-up email to taking into account the potential customer and relevant dealer profit in the customer’s existing staff is essential, followed by car as a used car sale. This is one further confirmation from reason why a regular huddle-style dealer to customer. This is also discussion between all relevant an opportunity to demonstrate staff to discuss potential renewals responsiveness by checking any is a wise investment. special requirements the customer Because you do not want to may have on the day. be going over old ground with A final check 24 hours before the customer when they are with the meeting is wise and if anything you, ensure deals are already put has cropped up to make the date together, demonstrating ‘plug and inconvenient now is the time to replay’ convenience for them. appoint them. From personal experience, without a 24-hour confirmation Make it personal attendance can be as low as 60% Although email works, nothing whereas a final check leads to over beats a personal call. But don’t 90% attendance. be tempted to make it a sales call – aim solely to create the appointment, rather than begin Prepare the basics a negotiation. Relying on a In my experience a common professional script will help to issue is failing to prepare for the
visit itself. Much of this is common sense, but still often overlooked. For example, ensuring the receptionist expects the customer, ensuring there is a parking space available and that the right personnel are definitely working that day. Avoid surprises on the customer’s vehicle condition by conducting an HPI check for any issues beforehand. Small touches like a welcome message on a board never hurt. Consider having the car you want them to buy parked next to the customer’s reserved space, so they have already seen it. And have someone valuing their car during the renewal discussion, so that any negotiation can proceed without interruption. In the end eliminating friction and maximising convenience is the name of the game and the better their experience, the more your customers will keep returning. www.auto-retail.com Oct 2020
AUTO RETAIL LIVE
The key lessons to take into Q4 Unemployment hopes There is, rightly enough, some concern about the unemployment figures as a result of Covid-19. However, Daksh Gupta, chief executive, Marshall Motors, points out that this might not have a direct impact on automotive retailing. “The people who have seen the biggest impact of job losses are 1624-year olds, but the people who are buying cars in the franchise sector are not in that sector,” he says.
Events possible with planning Social distancing doesn’t have to mean the end of VIP events, says John O’Hanlon, chief executive of Waylands Automotive. The company hosted one recently and smashed the previous result by 18%. “What you have to make sure is that you have a limited number
of visitors every 90 minutes,” he says. Customers were prepped and qualified and knew that they were coming to a buying event, not one to gather information to go away and think about.
Seizing opportunities John says that Waylands has realised opportunities by working harder on video health checks. “We have seen more customers demanding more parts and work by signing off on the video health check,” he says. “Make sure you are getting as close to 100% videos for customers that are coming in as possible.”
Don’t go backwards Ian Plummer, Auto Trader’s commercial director, said that companies should resist the urge
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www.auto-retail.com | Oct 2020
to go back to old ways of working, especially if the new method is proving popular. “A debate arose in lockdown when customers were allowed to drive the car on their own,” he says. “Some retailers thought they would be able to revert, but if the customer is used to it and appreciates it then it is good. Let’s not go back to the old methods, we have made it better, let’s stick with that.”
Deal with pressure head on It is better to have one difficult conversation about targets, says John O’Hanlan, but base it on facts and make sure it is an educated discussion. Having a target that is too high will lead to the wrong behaviour – an over reliance on pre-registration and discounting. We don’t want to go back to the lazy practices, he says.
~
Auto Retail Live took on September’s targets, with tips and insight to help you go strongly into Q4. These were the stand out points
We have seen more customers demanding more parts and work by signing off on the video health check
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www.sanity system.co.uk @autoretail | 13
MAKE MORE MONEY
Renault enjoys electric vehicle hea
R THE AUTHOR Name: Richard Aucock Position: Richard is Auto Retail Network’s new car expert
enault has a “significant market advantage” when it comes to selling electric vehicles, thanks to its network having almost a decade’s experience of doing so, according to the brand’s electrification and new mobility manager Matt Shirley. The first models went on sale in 2011 and the company has now trained 30,000 people in electric sales across its network. Every Renault retailer in the UK is certified for electric vehicle sales, helping the company become Europe’s leading retailer of EVs – a lead the company says “we aim to maintain” with the introduction
of the new Zoe. Sales of the latest version have already grown 50% compared to 2019. Now, Renault is launching its first electrified hybrid models – a pure hybrid Clio and plug-in hybrid versions of the Captur and Megane Sport Tourer. The vehicles are branded E-Tech, and visual differences compared to regular models are intentionally subtle to underline the mainstream nature of the technology – a few extra blue styling accents, plus E-Tech logos on the bootlid and front door pillar. Renault plans to emphasise its Formula 1 programme in marketing the technology. The engineers have
developed a clever two-motor drive system with a clutchless gearbox, following a similar concept to F1’s hybrid system. Racing team experience was actually used to develop the road car concept, which uses a motorsport-style dog-clutch gearbox rather than traditional synchromesh, for efficiency. It sounds exotic, says Matt, but it is also cost-effective, allowing Renault to price the entry-level Clio E-Tech Hybrid at under £20,000. The Capture E-Tech Plug-in Hybrid costs from £30,495, due to its bigger batteries (which give a 30mile electric range), but 10% BIK
New Toyota Yaris ‘a significant opportunity’ The Toyota Yaris has helped the brand to a significant growth in the supermini sector since it launched 20 years ago. The Yaris’s predecessor, the Starlet, only commanded a 1% market share while the Yaris managed an 8.1% share in the UK in 2019 with 28,000 sales. Toyota Motor Europe executive vice president Matt Harrison admitted it could have been higher still, had the firm been able to keep up with demand for the run-out car. “We don’t believe that’s going to come to an end… the next generation Yaris gives us significantly more opportunity,” he said. “Yaris customers are already the most loyal we have, but the new car gives us by far the most conquest power we’ve had for a couple of generations. It strengthens our appeal to a younger, different group of customers that we’ve never previously appealed to with Yaris.” The new car, of which UK deliveries begin this month, uses Toyota’s fourthgeneration hybrid system, with CO2 emissions from 92g/km and fuel economy of up to 68.9mpg – and those are WLTP figures, not NEDC. It is two seconds faster from 0-62mph and even the unappealing ‘slippingclutch’ effect of the CVT transmission
14 | @autoretail
has been minimised. With two electric motors and a new lithium-ion battery (instead of the old nickel-metal hydride unit), Toyota has extended the pure electric drive capabilities of the new Yaris. It is capable of switching to pure EV mode at speeds of up to 80mph. Already, Toyota figures show hybrids in cities generally run two thirds of the time, and half the distance, in engine-off mode. The enhanced efficiency of the new Yaris hybrid drivetrain is expected to improve this further (and is something
the firm is eager for retailers to demonstrate during test drives). The sales mix is 70% retail, slightly higher than the 65% sector average. The most popular variant, with almost a 50% sales mix, is expected to be Design (priced at £20,970), compared to 37% for entry-level Icon (costing £19,910). Higher-end Excel and Dynamic will comprise just under 20% of volumes. Toyota will also sell a non-hybrid 1.5-litre Yaris, and maybe an entry-level 1.0-litre version, but expects the hybrid to still take the vast majority of sales.
www.auto-retail.com Oct 2020
BRAND INSIGHTS
ad start as it launches new models
~
is expected to draw fleet car users – who will also be the key target for the Megane Sport Tourer E-Tech Plug-in Hybrid. “It’s effectively a monthly pay increase for company car drivers who choose a PHEV.” Renault plug-in hybrid buyers will also get a free BP Chargemaster
wallbox, complete with a three-pin charge adapter and a Type 2 cable. “This is to help customers get used to the concept of regularly charging up – so they may consider switching to a full EV with their next purchase.” Matt says the eight-year battery warranty, on
top of Renault’s five-year vehicle warranty, will also help retailers reassure customers. “After eight years, 99.5% of batteries are still within warranty conditions – we are finding battery degradation is much less than expected.”
After eight years, 99.5% of batteries are still within warranty conditions – battery degradation is much less than expected
Alfa Romeo targets fleet despite diesel dip Diesel sales are reducing at Alfa Romeo to the extent that they are “almost built to order today,” according to senior product manager Rob Lake. He adds that bigger models will keep the fuel going longest, saying: “Even Stelvio is trending to petrol, although SUVs will be the last bastion of diesel.” Rob moved from sister FCA brand Jeep to Alfa Romeo in the summer, and says his task is to take a deeper look at the range and further develop fleet sales. “We don’t do much fleet today,” he said. He is also looking at other channels, including Motability. Because of the heavy retail bias, the Alfa Romeo sales mix trends to higher-end Veloce and QV variants. Rob is considering a restructuring of the range to simplify the
www.auto-retail.com | Oct 2020
line-up with corporate customers in mind. Both Giulia and Stelvio have been updated for 2020 with improved quality, enhanced infotainment systems and more feature-packed ADAS safety systems. The products are being supported by an extensive marketing campaign featuring F1 driver Kimi Raikkonen. “The improved
cars will help with customer retention, but also allow retailers a second bite at conquesting those who considered Alfa Romeo but went for a BMW or an Audi instead.”
@autoretail | 15
MAKE MORE MONEY
Why Personal Contract Plans now offer used car buyers greater protection in the new normal
~ There can be no certainty in these far from certain times that other car makers will not withdraw from the UK marketplace
PCPs can offer a boost for new and used markets in times of uncertainty
P
ersonal Contract Plans, or PCPs, have increased in popularity in recent years and, bearing in mind these unprecedented and uniquely changing times, may become more popular for UK motorists looking for residual value certainty and protection. In a typical PCP transaction, the options at the end of the contract are weighted towards the consumer. If the value of the car exceeds the amount of the final balloon payment, the consumer can in many cases use the positive equity to fund the deposit for their next purchase, or simply receive the balance. If the value is less than the balloon payment, then the consumer can hand the car back to the lender who then has the issue of dealing with negative equity. In either scenario the consumer is protected. The consumer also has the option to pay or re finance the balloon and keep the car.
Future proofing In recent times we have witnessed Infiniti and, more recently, Mitsubishi announcing their intention to withdraw from the UK marketplace. Consumers who purchased these cars outright or via alternative funding
methods may well have the issue of potentially falling residual values of these cars to deal with, as desirability in these models decreases. Drivers of these cars who have purchased them via PCP have no such worries. There can be no certainty in these far from certain times that other motor manufacturers will not withdraw from the UK marketplace and put further pressure on the residual values of the new or used cars they leave behind.
PCP advantages 1. Set monthly motoring cost 2. Low entry costs due to manufacturer or dealer deposit contributions 3. Cash back if px vehicle exceeds deposit required 4. Allows consumers to acquire newer or better model cars due to balloon element, as they are not funding total vehicle price 5. No consumer risk caused by fluctuations in residual values. Interest paid on the loan has to be factored against paying cash, however the peace of mind motoring aspect offered by PCP needs to be considered by
THE AUTHOR Name: Ian Allen ian. allen@cnaint.com Position: Ian specialises in the operational business development and enhancement of motor dealerships and the turnaround of underperforming dealerships, with an emphasis on used car performance
consumers in the short to medium or longer term. PCP may not suit all motorists but if we are looking to kick start new car sales and maintain the already buoyant used car market, then this type of funding will be imperative for growth. Due to the consistently high demand for quality used cars there is the possibility of early change cycle for motorists, as their equity can be greater than the final balloon payment during the last year of the agreement. Whilst new car sales remain challenging it is highly likely that used cars will remain in high demand and resultantly retain their value.
YOUR ACTION PLAN n Demands and needs procedure will determine if PCP is right for each customer n GAP insurance is a key add on as with most finance agreements n Peace of mind monthly payment covers most eventualities n PCP agreements keep you in contact with the customer n Monitor early change cycle due to enhanced used car values
16 | @autoretail
www.auto-retail.com Oct 2020
PARTNER FEATURE
Pricing tool helps Shelbourne Motor Group boost engagement
S
helbourne Motor Group was founded by Fred Ward in 1973 as a filling station take over. Four decades later, the dealer group has continued to expand their business while remaining a family-run dealership, with an emphasis on transparency and exceptional customer service. Today, they are recognised as one of the most progressive and fastest growing car dealer groups in Northern Ireland. “We recommend any dealership to advertise their vehicles on CarGurus. In terms of the quality of leads we get from them, CarGurus is a great partner to work with,” said Ronan Marshall, group marketing manager, Shelbourne Motors
The challenge When Shelbourne Motors opened its newest showroom in 2019, it set very ambitious growth targets. To meet its goals, the biggest challenge it needed to overcome was pricing — both in terms of buying new inventory and selling existing stock — according to sales director Paul Ward. The team knew they needed to use data and technology to their advantage, so they turned to CarGurus for help.
a listing’s page ranking and deal rating. By leveraging this tool in the CarGurus Dashboard, Shelbourne Motors provided transparent yet competitive pricing on listings, which resulted in more engaged car buyers visiting the stock. “We’re able to analyse the vehicles that we’re going to purchase against the market with CarGurus and see if they’re going to fit our market, but also be good value for our customers,” said Paul Ward. As the team started to see quality leads and interactions flow though, the dealership ensured its follow-up processes were in check. “We respond to reviews and enquiries within 24 hours. As a family run business, customer satisfaction is really important to us and we try to reflect that online
as we do in the showrooms,” said Ronan Marshall.
Measuring the impact The group worked closely with their dedicated account manager to optimise their account and analyse results. “We look at the interactions from customers in terms of phone, email, web traffic, and map views in our dashboard, and CarGurus provides good value for us. “We’re very satisfied with the ROI we get,” said Ronan Marshall. By leveraging Post Code Matching reporting, the group saw the number of car sales CarGurus influenced and calculated return on investment. Over seven months***, CarGurus influenced 14% of Shelbourne Motors total car sales, equalling a positive return on its marketing spend.
The approach Shelbourne Motors used the CarGurus’ Market Analysis Tool to ensure its forecourt was stocked with the right inventory mix. The tool helps the team identify indemand vehicles in their local area to inform purchasing decisions at auctions and customer trade-in valuations. Additionally, Shelbourne Motors used the Pricing Tool daily to price its vehicles as good and great deals. The tool allows the team to see where even a small adjustment to a vehicle’s price can improve www.auto-retail.com | Oct 2020
CarGurus is the #1 auto marketplace in the US* and the fastest growing online automotive marketplace in the UK amongst its nearest competitors.** We help dealers quickly and easily market their vehicles and connect with more engaged buyers. To learn more about the challenges CarGurus solves for consumers and dealers, call this number 0808 196 5475 or visit www.cargurus.co.uk/signup/AutoRetail *Comscore Media Metrix® Multi-Platform, Automotive – Information/Resources, Total Audience, Q2 2020, U.S. (Competitive set: CarGurus.com, Autotrader.com, Cars.com, TrueCar.com) **Comscore MMX Multi-Platform®, Total Audience, Custom-
defined list includes CarGurus.co.uk, Motors.co.uk, AutorTrader. co.uk, Gumtree.com, Q2 2019 – Q2 2020, UK *** Post code matching data from June 2019 to December 2019, and including February 2020.
@autoretail | 17
BEST PRACTICE FINANCE DEALS
finance deals
MAKE & MODEL
OFFER OFFER OTR
ALFA ROMEO Big dealer contributions on key models Giulietta 1.4 Sprint £22,495 PCP, £2,800 dealer contrib Giulia 2.0 Turbo Veloce £42,120 PCP, £3,986 dealer contrib Stelvio 2.0 Turbo Veloce £51,255 PCP, £5,807 dealer contrib AUDI £5k dealer contribution on A5 A3 Saloon S line £32,795 PCP A4 Sport £34,660 PCP, £4,250 dealer contrib A5 Coupe Sport £39,680 PCP, £5,000 dealer contrib Q2 Technik £23,300 PCP, £3,000 dealer contrib SQ5 TDI quattro £55,745 PCP, £4,500 dealer contrib BMW PCP offers over 48-month term i3 £32,350 PCP, £2,405 dealer contrib 118i M Sport £27,805 PCP, £1,899 dealer contrib 218i Sport Active Tourer £28,045 PCP, £2,119 dealer contrib 420i M Sport Coupe £39,870 PCP, £2,934 dealer contrib X1 sDrive 18i Sport £31,205 PCP, £2,705 dealer contrib Z4 sDrive20i Sport £38,165 PCP, £4,074 dealer contrib DACIA Small deposits and low monthly prices, but interest rates on the high side Sandero Essential SCe £7,995 PCP, £250 dealer contrib Logan Access SCe £8,495 PCP, £250 dealer contrib Duster Access TCe £11,245 PCP FIAT Offers on mild hybrids Panda 1.2 Pop £10,580 PCP 500 Pop Mild Hybrid 1.0 £13,020 PCP, £1,000 dealer contrib 500C Pop Mild Hybrid 1.0 £15,670 PCP, £1,000 dealer contrib FORD 0% finance over 36-month term Fiesta Trend 1.0 £16,640 PCP, £1,000 dealer contrib Fiesta ST-2 1.5 £21,775 PCP, £1,000 dealer contrib EcoSport ST-Line 1.0 £20,995 PCP Focus ST-Line 1.0 £24,260 PCP, £750 dealer contrib HONDA Summer event provides an extra £1,000 off Civic VTEC Turbo £21,115 PCP, £1,000 off, £1,000 dealer contrib Jazz EX £21,385 PCP, £250 off e Advance £29,160 PCP CR-V EX 1.5 VTEC Turbo £35,750 PCP, £1,000 off, £500 dealer contrib HYUNDAI Voucher event provides up to £1,000 off i10 SE Connect 1.0 £13,820 PCP i20 Play 1.2 £14,915 PCP, £1,000 dealer contrib i30 N-Line 1.4 £21,815 PCP, £2,000 dealer contrib i30 Tourer SE Nav 1.0 £20,710 PCP, £2,000 dealer contrib JEEP Offers over 48-month term Renegade 1.0 Night Eagle £24,150 PCP, £3,000 dealer contrib Compass Limited 1.4 Multiair £29,760 PCP, £3,000 dealer contrib Wrangler 2.0 Night Eagle £49,850 PCP, £2,000 dealer contrib JAGUAR 0% finance on XE F-PACE 2.0d R-Sport Auto £44,105 PCP, £3,750 dealer contrib I-PACE S £64,495 PCP F-TYPE £54,510 PCP, £5,500 dealer contrib XE S £34,255 PCP, £1,500 dealer contrib KIA Up to £2,500 scrappage allowance Rio ‘1’ £13,000 PCP, £1,500 dealer contrib Ceed ‘3’ 1.6 Diesel £22,755 PCP, £2,500 dealer contrib ProCeed GT-Line S 1.4 Petrol £29,095 PCP, £2,500 dealer contrib Xceed ‘2’ 1.0 Petrol £20,840 PCP, £2,500 dealer contrib LAND ROVER Land Rover has reduced interest rates Range Rover Velar S Auto £51,050 PCP, £4,750 dealer contrib Range Rover Sport HSE Auto £67,645 PCP, £4,000 dealer contrib Range Rover 2.0 Vogue Auto £89,385 PCP, £5,000 dealer contrib LEXUS Zero deposit and low interest rates CT £26,275 PCP, £2,000 dealer contrib UX F Sport £33,950 PCP, £2,000 dealer contrib IS 300h £33,265 PCP, £2,000 dealer contrib MAZDA 0% finance on key models 2 SE-L Nav £16,840 PCP, £500 dealer contrib CX-30 SE-L £23,730 PCP CX-5 Sport £30,930 PCP
18 | @autoretail
DEPOSIT TERM MONTHLY FINAL APR PAYMENT PAYMENT
OFFER ENDS
£3,999 £7,799 £9,949
48 48 48
£239 £399 £429
£7,121 £14,536 £18,404
5.9% 4.9% 6.1%
30-Sep-20 30-Sep-20 30-Sep-20
£7,227 £5,363 £6,536 £3,400 £7,789
48 48 48 48 48
£349 £369 £399 £239 £569
£14,101 £11,278 £13,508 £8,800 £24,959
4.9% 3.3% 3.5% 4.7% 4.7%
30-Sep-20 30-Sep-20 30-Sep-20 30-Sep-20 30-Sep-20
£4,519 £4,699 £4,749 £4,689 £4,809 £4,439
48 48 48 48 48 48
£373 £269 £319 £459 £329 £399
£11,457 £11,051 £8,477 £15,272 £10,899 £14,292
4.9% 3.9% 3.9% 4.9% 3.9% 3.9%
30-Sep-20 30-Sep-20 30-Sep-20 30-Sep-20 30-Sep-20 30-Sep-20
£944 £1,108 £1,924
48 48 48
£109 £119 £139
£2,917 £2,807 £4,571
6.9% 6.9% 6.9%
30-Sep-20 30-Sep-20 30-Sep-20
£1,360 £1,500 £2,000
48 48 48
£169 £175 £224
£2,399 £3,669 £3,737
4.9% 4.9% 4.9%
30-Sep-20 30-Sep-20 30-Sep-20
£4,354 £4,034 £3,764 £5,505
36 36 36 36
£170 £245 £250 £220
£5,816 £9,039 £8,731 £9,215
0.0% 2.9% 0.0% 0.0%
30-Sep-20 30-Sep-20 30-Sep-20 30-Sep-20
£21,115 £4,517 £6,018 £9,302
36 36 36 36
£239 £229 £299 £365
£8,919 £10,782 £15,860 £15,417
5.9% 5.9% 5.9% 5.9%
30-Sep-20 30-Sep-20 30-Sep-20 30-Sep-20
£2,400 £2,600 £3,800 £3,600
48 48 48 48
£182 £165 £260 £246
£4,153 £4,944 £5,625 £5,252
4.8% 4.8% 4.8% 4.8%
30-Sep-20 30-Sep-20 30-Sep-20 30-Sep-20
£5,754 £6,082 £14,130
48 48 48
£199 £299 £449
£7,837 £9,552 £18,652
3.9% 4.9% 5.9%
30-Sep-20 30-Sep-20 30-Sep-20
£7,383 £6,449 £6,449 £6,449
48 36 36 36
£399 £976 £744 £353
£17,820 £30,824 £21,487 £13,589
3.9% 5.9% 5.9% 0.0%
30-Sep-20 30-Sep-20 30-Sep-20 30-Sep-20
£1,300 £2,275 £2,909 £2,084
36 36 36 36
£194 £333 £423 £256
£4,295 £7,889 £11,031 £8,877
4.9% 4.9% 4.9% 4.9%
30-Sep-20 30-Sep-20 30-Sep-20 30-Sep-20
£8,437 £10,839 £13,628
48 48 48
£499 £699 £899
£19,583 £28,933 £40,804
4.9% 5.9% 5.9%
30-Sep-20 30-Sep-20 30-Sep-20
£0 £0 £0
42 42 42
£387 £450 £501
£10,125 £16,786 £12,127
2.9% 3.9% 1.9%
30-Sep-20 30-Sep-20 30-Sep-20
£2,643 £3,738 £4,772
48 42 42
£189 £219 £315
£5,404 £10,793 £12,927
0.0% 0.0% 0.0%
30-Sep-20 30-Sep-20 30-Sep-20
www.auto-retail.com Oct 2020
FINANCE BEST PRACTICE DEALS
OFFER OFFER OTR
3 SE-L £21,840 PCP MERCEDES-BENZ Dealer contribution on E-Class tops £5k A 180 SE £23,755 PCP, £2,938 dealer contrib E-Class Saloon selected models From £38,880 PCP, up to £5,250 off C-Class Coupe selected models From £39,705 PCP, up to £2,300 off S-Class Saloon selected models From £76,640 PCP, up to £7,200 off MG 0% finance on 3 and ZS 3 Excite 1.5 £12,195 PCP ZS Excite 1.5 £15,495 PCP ZS EV Excite £28,495 PCP, £1,500 dealer contrib, £3,000 PiCG MINI £2k deposit secures Cooper models 3-dr Cooper Classic £17,640 PCP, £449 dealer contrib 5-dr Cooper Sport £21,180 PCP, £850 dealer contrib Countryman Cooper Classic £24,295 PCP, £749 dealer contrib MITSUBISHI Zero deposit but interest rates on the high side ASX Dynamic Manual £21,035 PCP, £1,800 off Outlander PHEV Design £36,825 PCP, £4,000 off NISSAN One month’s payment as depost on Micra Micra IG-T 100 Acenta £15,640 PCP, £2,000 dealer contrib Juke DIG-T N-Connecta £21,460 PCP, £1,250 dealer contrib Qashqai 1.3 DIG-T N-TEC £26,845 PCP, £2,750 dealer contrib PEUGEOT Deposit on 108 just £153, plus £3,150 dealer contribution 108 Active 1.0 £13,185 PCP, £3,150 dealer contrib 208 Active 1.2 PureTech £17,155 PCP, £1,500 dealer contrib 3008 Active 1.2 PureTech £26,905 PCP, £900 dealer contrib RENAULT Low deposit and 0% finance on Clio Clio Play SCe £15,295 PCP, £862 dealer contrib Captur Iconic TCe £19,795 PCP, £303 dealer contrib Megane GT Line TCe £21,795 PCP, £750 dealer contrib SEAT Offers over 48-month term Ibiza SE 1.0 TSI £17,175 PCP, £1,500 dealer contrib Arona FR 1.0 TSI £21,075 PCP, £2,500 dealer contrib Tarraco FR 1.5 TSI Evo £31,460 PCP, £2,500 dealer contrib SKODA Zero deposit on key models Fabia SE 1.0 TSI £16,405 PCP, £2,750 dealer contrib Kamiq SE 1.0 TSI £21,120 PCP, £2,500 dealer contrib Scala SE L 1.0 TSI £21,480 PCP, £2,750 dealer contrib SMART Discounting knocks a third off price of EQ forfour EQ forfour pulse premium £22,484 PCP, £7,556 off SSANGYONG Korando at under £200 per month over three-year term Korando ELX 1.5 £19,995 PCP, £2,000 dealer contrib Rexton EX Manual £29,995 HP SUBARU Offers over 36-month term XV 1.6i SE Premium £30,335 PCP Forester e-BOXER 2.0i XE £36,335 PCP, £2,000 dealer contrib SUZUKI One month’s payment as depost on Ignis Swift 1.2 Dualjet Hybrid SZT £14,549 PCP, £500 dealer contrib Ignis 1.2 Dualjet Hybrid SZ-T £15,499 PCP Vitara 1.4 Boosterjet Hybrid SZT £22,749 PCP TOYOTA 0% finance on key models AygoX-Trend £13,855 PCP, £500 dealer contrib Yaris Y20 £17,765 PCP, £1,000 dealer contrib Yaris Y20 Hybrid £20,355 PCP, £750 dealer contrib VAUXHALL Almost £4k deposit on Crossland and Astra Corsa SE 1.2 £18,365 PCP, £1,400 dealer contrib Crossland X Griffin 1.2 £23,550 PCP, £3,900 dealer contrib Astra SRi Nav 1.2 £27,545 PCP, £3,800 dealer contrib VOLKSWAGEN Offers over 42-month term with low interest rate Tiguan Match 2.0 TDI £32,115 PCP, £2,600 dealer contrib Polo Match 1.0 £17,030 PCP, £1,350 dealer contrib Golf 8 Life 1.5 £23,900 PCP, £1,100 dealer contrib VOLVO 0% finance on key models V60 B3 Momentum £34,960 PCP, £4,979 dealer contrib S60 B5 R-Design £39,710 PCP, £5,595 dealer contrib XC90 B5 Momentum £54,975 PCP, £4,447 dealer contrib
www.auto-retail.com | Oct 2020
DEPOSIT TERM MONTHLY FINAL APR PAYMENT PAYMENT
OFFER ENDS
£3,545
48
£225
£8,284
0.0%
30-Sep-20
£299 varies varies varies
48 48 48 48
£299 varies varies varies
£9,050 varies varies varies
4.9% 3.9% 4.9% 2.9%
30-Sep-20 30-Sep-20 30-Sep-20 30-Sep-20
£1,910 £1,382 £4,412
48 48 48
£149 £179 £279
£3,132 £5,520 £9,018
0.0% 0.0% 4.9%
30-Sep-20 30-Sep-20 30-Sep-20
£2,000 £2,000 £2,000
48 48 48
£230 £275 £315
£6,021 £7,395 £9,111
3.9% 3.9% 3.9%
30-Sep-20 30-Sep-20 30-Sep-20
£0 £0
48 48
£329 £566
£7,118 £11,872
6.9% 6.9%
30-Sep-20 30-Sep-20
£208 £1,500 £2,500
48 36 48
£208 £308 £326
£5,332 £9,750 £9,027
4.9% 4.9% 4.9%
30-Sep-20 30-Sep-20 30-Sep-20
£153 £948 £4,858
48 48 48
£173 £229 £309
£3,441 £6,138 £10,426
5.9% 5.0% 5.9%
30-Sep-20 30-Sep-20 30-Sep-20
£750 £120 £4,121
36 48 48
£199 £259 £249
£6,519 £8,448 £7,377
0.0% 4.9% 4.9%
30-Sep-20 30-Sep-20 30-Sep-20
£1,717 £2,107 £3,146
48 48 48
£236 £239 £403
£5,271 £8,307 £11,403
6.4% 6.4% 6.2%
30-Sep-20 30-Sep-20 30-Sep-20
£0 £0 £0
42 42 42
£240 £293 £315
£4,682 £8,055 £7,120
4.3% 4.4% 4.3%
30-Sep-20 30-Sep-20 30-Sep-20
£2,612
48
£164
£6,650
6.0%
30-Sep-20
£4,221 £9,804
36 60
£199 £379
£8,245 £389
4.8% 4.9%
30-Sep-20 30-Sep-20
£3,826 £8,711
36 36
£439 £299
£13,694 £18,098
4.9% 4.9%
30-Sep-20 30-Sep-20
£1,750 £197 £4,527
48 48 48
£149 £197 £229
£4,647 £5,807 £7,234
0.0% 0.0% 0.0%
30-Sep-20 30-Sep-20 30-Sep-20
£3,197 £4,656 £4,935
48 48 48
£129 £149 £169
£4,095 £5,107 £6,727
0.0% 0.0% 0.0%
30-Sep-20 30-Sep-20 30-Sep-20
£2,208 £1,758 £1,980
48 48 48
£199 £220 £299
£6,119 £5,805 £6,587
5.5% 5.5% 5.5%
30-Sep-20 30-Sep-20 30-Sep-20
£7,016 £3,679 £5,897
42 42 42
£329 £170 £205
£10,314 £5,750 £9,804
3.4% 3.4% 3.6%
30-Sep-20 30-Sep-20 30-Sep-20
£6,396 £7,222 £10,106
36 36 36
£283 £370 £507
£13,381 £13,552 £22,156
0.0% 0.0% 0.0%
30-Sep-20 30-Sep-20 30-Sep-20
finance deals
MAKE & MODEL
@autoretail | 19
new car sales
NEW VEHICLE SALES
August
Year-to-date
Top 10 best sellers
Brand
2020
2019 Change Share
2020
2019 Change Share
Ford
10,843
10,764
0.73
12.43
89,531
155,602 -42.46
Volkswagen
8,790
11,334
-22.45
10.08
83,340
137,408 -39.35
9.10
BMW
5,360
4,853
10.45
6.14
63,386
104,072 -39.09
6.92
Mercedes-Benz 5,234
5,040
3.85
6.00
61,171
110,086 -44.43
6.68
9.78
Audi
6,120
9,062
-32.47
7.02
58,542
100,513 -41.76
6.39
Toyota
4,137
4,205
-1.62
4.74
53,396
69,023 -22.64
5.83
Vauxhall
5,075
4,864
4.34
5.82
52,422
109,826 -52.27
5.73
Kia
4,179
3,452
21.06
4.79
42,259
63,799 -33.76
4.62
Nissan
2,621
2,328
12.59
3.00
39,305
61,262 -35.84
4.29
Land Rover
2,042
1,677
21.77
2.34
33,396
47,922 -30.31
3.65
Skoda
3,603
2,802
28.59
4.13
32,836
49,368 -33.49
3.59
Peugeot
3,520
3,608
-2.44
4.04
31,362
53,618 -41.51
3.43
Seat
2,236
3,610
-38.06
2.56
27,860
46,779 -40.44
3.04
Hyundai
3,076
2,686
14.52
3.53
26,202
54,251 -51.70
2.86
Mini
2,013
1,819
10.67
2.31
24,731
38,052 -35.01
2.70
Renault
2,805
1,872
49.84
3.22
24,672
36,172 -31.79
2.69
Volvo
1,381
1,268
8.91
1.58
23,037
35,545 -35.19
2.52
Citroen
1,689
1,798
-6.06
1.94
16,636
35,655 -53.34
1.82
Honda
1,744
2,592
-32.72
2.00
16,505
30,641 -46.13
1.80
Jaguar
1,059
1,049
0.95
1.21
14,356
23,312 -38.42
1.57
Mazda
1,128
1,509
-25.25
1.29
12,679
25,724 -50.71
1.38
Fiat
1,077
881
22.25
1.23
11,354
20,105 -43.53
1.24
Dacia
1,180
1,031
14.45
1.35
11,171
21,044 -46.92
1.22
Suzuki
1,395
2,092
-33.32
1.60
11,085
25,919 -57.23
1.21
MG
1,010
663
52.34
1.16
10,568
7,989 32.28
1.15
Lexus
368
424
-13.21
0.42
7,648
8,974 -14.78
0.84
Porsche
709
646
9.75
0.81
7,077
8,208 -13.78
0.77
Mitsubishi
578
715
-19.16
0.66
6,215
11,504 -45.98
0.68
Jeep
418
411
1.70
0.48
2,505
4,099 -38.89
0.27
DS
148
187
-20.86
0.17
1,294
2,286 -43.39
0.14
Abarth
146
118
23.73
0.17
1,273
2,226 -42.81
0.14
Alfa Romeo
77
208
-62.98
0.09
1,202
2,305 -47.85
0.13
Ssangyong
56
80
-30.00
0.06
897
1,251 -28.30
0.10
Bentley
58
96
-39.58
0.07
747
1,062 -29.66
0.08
Smart
116
212
-45.28
0.13
710
3,742 -81.03
0.08
Subaru
34
52
-34.62
0.04
400
1,518 -73.65
0.04
Maserati
56
54
3.70
0.06
359
665 -46.02
0.04
126 -42.06
6
12
-50.00
0.01
73
Polestar
Alpine
26
0
0.00
0.03
34
0
0.00
0.00
Chevrolet
0
32
0.00
0.00
0
55
0.00
0.00
275
Infiniti
0.01
0
34
0.00
0.00
0
0.00
0.00
88
140
-37.14
0.10
1,135
1,936 -41.37
0.12
Other Imports 1,025
2,293
-55.30
1.18
12,244
5,097 140.22
1.34
-5.78
915,615
1,519,016 -39.72
Other British Total
87,226
92,573
20 | @autoretail
August 2020 Units Share (%) Ford Fiesta 3,372 3.9 Volkswagen Golf 2,570 2.9 Ford Focus 2,391 2.7 Ford Puma 21,28 2.4 Vauxhall Corsa 2,081 2.4 M-Benz A-Class 1,722 2.0 Volkswagen Tiguan 1,645 1.9 Volkswagen Polo 1,466 1.7 Ford Kuga 1,434 1.6 Kia Niro 1,417 1.6 Total market 87,226 Jan-Aug 2020 Units Share (%) Ford Fiesta 29,891 3.3 Ford Focus 25,517 2.8 Vauxhall Corsa 25,182 2.8 Volkswagen Golf 24,395 2.7 M-Benz A-Class 19,370 2.1 Nissan Qashqai 18,736 2.0 Mini 16,528 1.8 Volkswagen Polo 14,512 1.6 Volkswagen Tiguan 14,467 1.6 Toyota Yaris 13,546 1.5 Total market 915,615 Top 15, retail sales August 2020 Change (%) Ford 6,639 11.0 Volkswagen 3,413 -22.6 Audi 2,848 35.0 BMW 2,314 37.3 Kia 1,903 13.0 Mercedes-Benz 1,817 -1.0 Vauxhall 1,599 -23.7 Toyota 1,598 0.3 Peugeot 1,557 -7.7 Hyundai 1,473 2.2 Land Rover 1,340 55.8 Skoda 1,051 24.7 Nissan 1,026 12.3 Renault 600 -23.3 Seat 536 -51.1 Total retail 39,833 -1.7 Top 15, fleet/business sales August 2020 Change (%) Volkswagen 5,377 -22.3 Ford 4,204 -12.1 Vauxhall 3,476 25.6 Mercedes-Benz 3,417 6.6 Audi 3,272 -52.9 BMW 3,046 -3.9 Skoda 2,552 30.3 Toyota 2,539 -2.8 Kia 2,276 28.7 Renault 2,205 102.3 Peugeot 1,963 2.2 Seat 1,700 -32.4 Hyundai 1,603 28.8 Nissan 1,595 12.8 Land Rover 702 -14.1 Total fleet/business 45,943 -5.5 Change = compared to same period of previous year Source: SMMT
www.auto-retail.com Oct 2020
NEW VEHICLE SALES
Strong July emphasises strength of bounce-back
T
he average UK motor retailer made a profit of £52,000 during July, recovering more than half the losses suffered during Q2. While some of this may be a result of a submission catch-up, it shows the strength of the bounce-back that retailers have seen since reopening the showrooms. The 12-month return-on-sales figure rose significantly as the positive result for July 2020 contrasted with a break-even month in the prior year. While there is still clearly significant catching up still to do, it shows that even with the two-and-a-half-month lockdown, automotive retailers should still post an average profit for 2020. The used car market has been strong since the lifting of the lockdown. This is reflected in the 12-month used car return on investment, which is now back up to 73.9% despite the assets effectively not generating a return for over two months of the year. Retail profit per unit is at record levels and significant stock write-downs have not been required. July’s strong profitability appears to have continued through August and into September, with both sales and aftersales performing strongly.
Key performance indicators, rolling 12 months to July 2020
2020
2019
Net profit as % sales
0.35%
0.91%
3%
Overhead absorption
44.6%
52.2%
80%
Used:new sales Sales expenses as % of gross
Ford
5,384
7,259
-25.83
Mercedes-Benz
4,100
4,751
-13.70
Volkswagen
2,530
2,966
-14.70
1.54:1
1.5:1
68.8%
66.5%
50%
121
167
150
Used vehicle stockturn (days) Return on used car investment
59.8
59.5
45
73.9%
76.7%
100%
Overall labour efficiency
83.4%
100%
Service gross profit % on labour
74.4%
74.9%
75%
Service expenses as % of gross
65.4%
63.0%
40%
1.58
1.55
2.5
Hours per retail job card
Parts gross profit %
21.2%
20.4%
22%
Parts expenses as % of gross
45.1%
44.3%
40%
7.72
7.36
8
Parts stockturn
Data compiled by ASE plc
Data source: SMMT
Year-to-date
2019 Change % Share %
2020
2019
27.74
49,377
21.13
18,558
13.04
Change %
Share %
82,084
-39.85
31.66
26,166
-29.08
11.90
16,290
28,283
-42.40
10.44 9.16
Peugeot
1,874
1,206
55.39
9.66
14,284
21,365
-33.14
1,087
1,413
-23.07
5.60
12,134
18,397
-34.04
7.78
Vauxhall
1,077
1,211
-11.07
5.55
14,911
19,173
-22.23
9.56
Renault
732
1,776
-58.78
3.77
5,721
14,185
-59.67
3.67
Fiat
576
603
-4.48
2.97
4,177
6,448
-35.22
2.68
274
76.28
2.49
4,675
4,977
-6.07
3.00
96 264.58
1.80
1,231
974
26.39
0.7
1.77
5,567
7,862
-29.19
3.57
Toyota
483
MAN
350
Nissan
343
378
-9.26
Mitsubishi
259
295
-12.20
1.33
2,476
7,309
-66.12
1.59
LDV
153
74 106.76
0.79
658
397
65.74
0.42
Iveco
144
173
-16.76
0.74
1,447
1,811
-20.10
0.93
Renault Trucks
116
92
26.09
0.60
751
913
-17.74
0.48
Isuzu
101
436
-16.76
0.52
2,088
2,981
-29.96
1.34
Isuzu Truck
43
52
-17.31
0.22
559
536
4.29
0.36
Land Rover
25
32
-21.88
0.13
762
914
-16.63
0.49
Ssangyong
19
18
5.56
0.10
205
433
-52.66
0.13
Fuso
11
12
-8.33
0.06
113
128
-11.72
0.07
Hyundai
0
3
0.00
0.00
0
64
0.00
0.00
19,407 23,120 -16.06
155,984 245,400
Market sectors
Citroen
Total light CV
85.1%
-36.44
August 2020 Units Change (%) Pickups 2,239 -2.4 4x4s 31 -3.1 Vans under 2.0t 1,150 -35.0 Vans 2.0-2.5t 2,760 -3.2 Vans 2.5-3.5t 13,227 -18.2 Total 19,407 -16.1 Jan-Aug 2020 Pickups 20,227 -40.1 4x4s 869 -12.2 Vans under 2.0t 9,679 -47.7 Vans 2.0-2.5t 26,088 -28.1 Vans 2.5-3.5t 99,122 -36.4 Total 155,984 -36.4 Rolling year Pickups 39,524 -27.7 4x4s 1,499 -12.1 Vans under 2.0t 17,345 -33.7 Vans 2.0-2.5t 46,090 -14.2 Vans 2.5-3.5t 171,904 -30.1 Total 276,362 -27.7
Change = compared to same period of previous year. SMMT
new van sales
2020
1.67:1
Sales per salesman
August Brand
Benchmark
www.auto-retail.com | Oct 2020
@autoretail | 21
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