THE National Franchised Dealers Association has written to chancellor Rishi Sunak, urging the government to support car dealers during the coronavirus outbreak.
Sue Robinson, director of the NFDA, said: ‘The retail automotive sector employs 590,000 people in the UK and businesses must be protected through supportive fiscal measures.’
The NFDA is concerned that the government is only targeting support at one group of businesses, namely small to medium-sized enterprises.
But the association pointed out that franchised vehicle retailers pay very high levels of business rates and operate on much tighter margins than most SMEs, with high fixed costs such as rent, business rates, VAT and wages.
The NFDA has recommended that:
• Temporary business rates relief be extended to all retail businesses, regardless of their rate bill.
• The British Business Bank be authorised to extend the Coronavirus Business Interruption Loan Scheme to any retail business, regardless of size.
• Statutory sick pay (due to coronavirus) relief should be provided for the first two weeks to all retail businesses, regardless of size.
Robinson said: ‘The impact of the virus is going to be felt across every part of the economy – especially the retail sector.
‘Revenues from vehicle sales and services will not only be impacted by the introduction of social distancing, but also by the widespread shutdown of European car and parts manufacturing.
‘There is a real danger that if the government is only targeting support at one group of businesses (SMEs), some big businesses will fail, causing business interruption in any case for SMEs that contract with them. The automotive retail sector needs to be protected regardless of size.
‘The NFDA would welcome the opportunity to further discuss with the government the severity of the financial challenges that franchised vehicle retailers are facing.’
