3:32 pm, May 7, 2020
The start of lockdown towards the end of March contributed to a 43 per cent drop in profitability for the average UK car retailer to £68,000, preliminary figures published today (May 7) by ASE Automotive Solutions show.
The dealer profitability specialist reported that submissions by retailers fell by ‘an understandable 25 per cent’, with a lower number of franchises finalising their retailer results for March.
It added that the preliminary results didn’t paint as complete a picture as usual, as a large number of orders couldn’t be delivered at the end of March.
Based on the data from those that did provide data, though, overall profitability fell by £50,000 against March 2019.
Mike Jones, ASE chairman, said: ‘This is no surprise, given the drop in volume for both car sales and aftersales, with the industry missing out on what is normally the busiest, and most profitable, month of the year.
‘Most of these vehicles are physical in the country, and the fast sale and delivery of the missed March capacity is going to be vital to retailers achieving a fast start.’
He added that April would show the true impact of the crisis on the industry in the UK, saying: ‘Coronavirus is clearly going to have a massive effect on retailer profitability for 2020.
‘We will see the level of activity being maintained during lockdown and the associated cash burn when we analyse the April performance.’
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