8:11 am, August 20, 2026
Bosses at new and used car dealer City West Country have blamed a ‘challenging trading environment’ after the firm slumped to a heavy loss in 2026.
Documents recently posted via Companies House, show that the Exeter-based retailer made a pre-tax loss of £6.08m in the year ending December 31, 2025.
The figure represents a complete collapse on last year’s profit of £5.42m, with directors pointing to Mercedes’ switch to agency sales as well as ‘major global changes in the industry’.
They insisted that the company’s performance was ‘satisfactory’ throughout the year, despite slipping into the red, with the figures heavily affected by a £7.65m exceptional provision relating to inter-company debt.
Had that provision not been made, the dealer group would have made an operating profit of around £1.63m, according to the accounts.
Elsewhere, the dealer group’s turnover also fell sharply during the year, dropping 27% from £219.7m in 2024 to £160.23m.
Vehicle sales accounted for £138.27m of revenue, down from £190.68m the previous year, while aftersales turnover fell from £29.02m to £21.96m.
Despite the struggles, bosses said demand for new and used cars remained strong throughout the year.
Writing in the accounts, director Gavin Walker, said: ‘The year to December 2025 was a challenging trading environment with major global changes in the industry, pressure from multiple macroeconomic events, the settling in the UK market of the Mercedes Benz agency strategy, a change in national political outlook and a very competitive trading environment.’
He added: ‘The directors consider the financial performance in 2025 to be satisfactory considering the wider economic climate and the extremely competitive UK motor retailing marketplace and the general cautious outlook adopted by consumers.
‘During the prior year the company made the strategic decision to acquire an additional Mercedes Benz LCV franchise in the South West to supplement and expand its existing Mercedes Benz LCV operations.
‘The company continued to invest in all its sites in the year and this policy will continue.’
Elsewhere, the accounts showed that the car dealer’s cash at bank and in hand increased from £8.9m to £12.83m, although creditors due within one year more than doubled from £31m to £63.89m.
The business, which represents Mercedes, Smart, BYD, Maxus and Chery in the South West, also increased its workforce throughout the year, with staff numbers reaching an average of 678, compared with 647 in 2024.
That contributed to increased staffing costs of £23.31m, while directors’ remuneration increased from £989,000 to £1.1m. The highest-paid director received £401,399.
No dividends were paid during the year and the board did not recommending any final payment.