Mercedes-Benz Retail Group (MBRG) made an eye-watering pre-tax loss of £20.9m in 2020, the firm’s accounts have shown.
The dealer arm of German car manufacturer was hit hard by the pandemic, which significantly reduced its turnover.
Accounts published via Companies House show that the group made £706.07m in revenue in the year ending December 31, 2020.
That is a fall of over 31 per cent from the pre-pandemic 2019 when it generated £1.025bn in revenue.
Despite the reduced incomings, 2020’s loss is actually less than a year previously, when MBRG lost £72.53m before tax.
The accounts show that the group claimed £5.7m in furlough cash and paid £56.15m in salaries and wages to employees.
That is over £9m less than the £65,258,000 it shelled out in 2019.
Last year also saw the firm’s new passenger car volume deliveries fall by 45 per cent year-on-year.
The results have led to the group’s parent company – Daimler – to ‘refocus its strategy’ and ‘take action on structural costs’.
It is now planning to divest of MBRG in order to transform its own retail business for Mercedes cars and vans.
Despite the news, bosses at the dealer group are anticipating better results in 2021.
Last month they announced a new flagship dealership in West London.
In a statement included in the accounts, Tim Schoeler, chief financial officer at Mercedes-Benz Retail Group, said: ‘2020 was dominated by the Covid-19 pandemic – and like other industries the automotive industry, and indeed, MBRG were hit by challenging trading restrictions.
‘These included the temporary closure of all our sales and some of our aftersales operations for significant periods, due to lockdowns.
‘However, our newly launched online showroom played a significant role in supporting changes in customer purchasing habits during the lockdowns and indeed beyond.
‘Despite our robust Covid-19 practices, Covid-19 related illness, as well as self-isolation resulted in higher than normal employee absence.
‘With the UK economy, effectively at a standstill both business and consumer confidence fell to an all time low.’
He added: ‘The directors, expect 2021 to be a strong year of recovery not only for MBRG but for the motor trade as a whole.
‘The easing of restrictions in the UK has boosted consumer confidence and allowed us to reopen our dealerships at full capacity, combined with the benefits of our online showroom, in supporting customers with online purchases.’
How did other dealer groups get on in 2020?
- Glyn Hopkin posts improved profit in 2020 despite being hit by pandemic
- Hendy Group announces reduced 2020 pre-tax profit of £1.11m – despite being one of few dealers to see improved turnover
- Peter Vardy sees profits rise by close to 50 per cent as dealer group comes out on top in battle against pandemic
- Rybrook Group announces reduced pre-tax profit of £3.25m for 2020
- Arnold Clark posts mighty profit of £156.5m for 2020 and now calls itself a ‘stronger’ and ‘leaner’ business
- Donnelly Group benefits from furlough scheme to make £1.46m profit in 2020 after previous loss of £2.66m
- Bells Motor Group posts improved pre-tax profit of £1.4m after claiming nearly £400,000 in furlough cash
- Motorline doubles 2020 pre-tax profits but relies heavily on government furlough cash, claiming £7.1m
- Jardine Motors Group suffers catastrophic year as £8.3m operating profit slides to £9.8m loss despite £12m-plus furlough support
- Trade Centre Group’s pre-tax profit drops by 58 per cent to £7.5m for year, thanks to pandemic
- Furrows enjoys 38 per cent profit rise after being given more than £1.5m of furlough grants
- John Clark Motor Group’s pre-tax profit more than doubles to £6.25m despite drop in sales
- Bentleys Motor Group swings from loss to profit – helped by furlough handouts
- Williams Group’s pre-tax profit soars by 114 per cent to £6m helped by £5m-plus in furlough support
- Lookers 2020 results show £14.1m profit as it emerges from turbulent year as ‘a better business’
- WR Davies notches up record year as nearly £1.5m in furlough cash helps it through pandemic
- Caffyns’ pre-tax profit soars by nearly 1,300 per cent, thanks to £1.3m in furlough grants
- Johnsons Cars pre-tax profit soars to £3.2m from £632,000 during ‘turbulent year’
- Yeomans more than doubles its pre-tax profit after claiming £2.53m in furlough grants
- Vertu Motors: ‘Impressive’ results show group made £24.6m profit last year – ahead of all predictions