7:59 am, March 13, 2023
Secretive Constellation Automotive Group has revealed its online used car dealer Cinch has had a ‘record’ start to 2023.
The boss of the used car dealer – which clocked up a £149m pre-tax loss last year – told The Sunday Times Cinch and its car buying platform WeBuyAnyCar was on a roll.
CEO Avril Palmer-Baunack, who rarely talks to the press, told the paper that the last quarter of 2022 made ‘people very nervous’, but things have improved rapidly since.
She said: ‘Since January, we’ve had record days at WeBuyAnyCar and at Cinch.
‘And we see stock starting to flow as well, so there are vehicles starting to come into the market.
‘We’re having a very strong quarter. It’s surprised me.’
The few-sentences-long update is the biggest insight the motor trade has had into how the online used car rival to Cazoo, and the previously failed Carzam, is faring.
Cinch rarely talks about its success, or otherwise, and insights into the business are usually restricted to its annual filings with Companies House.
Constellation also owns BCA, the auction house, and last year snapped up Marshall Motor Group off the stock market in a £325m deal.
Since then, Constellation has taken a three per cent stake in listed car dealer Vertu Motors and a 20 per cent stake in Lookers.
Many in the industry have been wondering what the group is plotting. Palmer-Baunack’s chat with the Sunday Times certainly suggested there is more to come.
She told the paper: ‘Perhaps others will buy and there could be consolidation.
‘There’s opportunity in the market for sure … It’s been tough out there from a point of view of the lack of stock.
‘But pricing has been strong, so there are definitely undervalued businesses in the market.’
Constellation Automotive Group is owned by investment firm TDR Capital. The private equity house also backs the Issa brothers – the duo who bought up hundreds of petrol stations under the Euro Garages name and then made an audacious bid for Asda.
Values – and interest – in listed car dealers have grown since American giant Lithia’s audacious £300m bid to buy the Ferrari and Porsche franchise holder Jardine. That deal is still said to be going through.
Zeus Capital’s Mike Allen recently told Car Dealer the listed groups now look incredibly ‘good value’ in light of this bumper valuation and many expect Constellation to make a further move to consolidate the market.
