3:23 pm, March 8, 2017
THE average UK car retailer made a profit of £2,600 in January, beating the result from January 2016 when they scraped above break-even, according to latest figures from profitability specialists ASE.
Chairman Mike Jones said: ‘While it is certainly too early to start celebrating, this is clearly a good start to the year. We will only get a full picture of performance once we have closed the first quarter. However, initial indications are good, with the market set to outperform the prior year, in registration terms at least.’
In many cases, he said, the ASE saw a continuation of 2016’s trends in January. Registration levels were pushing ahead, with new car sales lagging behind and genuine retail sales falling, while self-registered cars continued to be remarketed as used cars.
‘There is no sign yet of excessive pricing pressure on used cars as a result of this, with auction prices remaining strong and many groups out actively buying,’ said Jones. ‘We will continue to watch the used vehicle stockturn and return on investment ratios closely to ensure that stocks are being cycled and margins are remaining strong.’
He added: ‘The first quarter of 2017 looks like it will produce a record registration quarter, which should bring a boost to profits. We will wait to see whether it is one last hurrah or if the temptation to continue to push UK market registrations proves too great.’
MORE: Record registrations but lower profits for dealers in 2016, reports ASE
MORE: Poor profitability for the average dealer in October, says ASE
MORE: Average UK retailer made £42,000 profit in June, says ASE
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