8:50 am, May 6, 2025
Bosses at Swansway Motor Group they say are ‘more than satisfied’ with the firm’s performance despite announcing a dip in pre-tax profit.
Accounts seen by Car Dealer show that the Crewe-based group made a profit before tax of £7.7m in the 12 months to the end of December 2024, compared to £13.4m in 2023.
While the figure may be more than 40% down on the previous year’s result, directors say there are plenty of reasons to be cheerful for family-run business.
The firm saw turnover skyrocket from £941m in 2023 to £946m in 2024, aided by impressive used car sales which rose by 16.8% to 18,218 units.
The year also saw Swansway grow its retail network with the addition of two BYD sites and a Honda showroom, taking its total number of dealerships to 23.
Despite this, the group’s EBITDA figure – the measure by which our Car Dealer Top 100 list is judged – dipped from £24m to £19m.
In response to the results, director Peter Smyth told Car Dealer that 2024 represented the business’s first ‘normal’ year since the pandemic.
He added that the period had been tough for VW Group brands – especially Audi – but that Swansway was continuing to ‘outperform its peers’.
‘2024 was the first “normal” year post-COVID and our result was more than satisfactory if you compare it to 2019 when interest rates were significantly lower,’ said Smyth.
‘The vast majority of the franchises we hold are within the Volkswagen Group and 2024 was particularly difficult for the Audi brand where Swansway significantly outperformed its peers.
‘The most pleasing result came in used cars where we achieved a like for like increase in sales to 18,218 vehicles from 15,603; a 16.8% increase.
‘We have worked tirelessly to keep our aged used stock to a minimum and achieved an industry leading 14 times stock turn.
‘The auditor commented at the sign off meeting that they had never seen a case where all the cars that were overage at year end were sold by 31st January of the following year.’
Margins down as staff costs rise
Elsewhere, the accounts saw Swansway follow market trends which have been experienced across the industry in recent years.
According to the documents, which are yet to be published via Companies House, the firm’s gross margins fell from 6.21% in 2023 to 5.36% in 2024.
The company also faced rising overheads, with staff costs coming in at £58.12m – up from £56.55m the previous year – while directors’ remunerations rose from £4.06m to £4.4m.
In a statement included in the accounts, secretary Richard Marsland also highlighted the ZEV mandate and a shortage of suitable stock as major headaches throughout the year.
He said: ‘Profitability during 2024 remained good despite a difficult trading environment with gross margins coming under pressure and a general increase in overheads. Despite this the Group returned an encouraging profit before tax.
‘The manufacturers’ necessity to meet the ZEV mandate meant that there were less customer incentives available during the year which in turn impacted demand for both ICE and EV product.
‘Furthermore, manufacturer consumer finance packages were not as favourable with increased monthly payments proving a disincentive ot customer new vehicle renewals.’
He added: ‘Despite a shortage of suitable stock, used vehicle volumes increased year on year, the market proving to be very strong.
‘Good margins were maintained, supported by an industry leading stock turn and adherence to a rigid stocking policy.’
‘We have always operated fully to conditions set out by the lenders’
One of the biggest topics of the last year for dealer groups like Swansway has been the motor finance crisis and how it will impact on retailers.
Appearing at Car Dealer Live earlier this year, Smyth admitted to ‘concerns’ about any potential fallout.
Close Brothers’ Supreme Court appeal against last year’s Court of Appeal ruling was heard in April with a verdict expected over the summer.
Writing in the accounts, Marsland said that Swansway was ‘closely monitoring’ the situation but insisted that the group has always complied with FCA rules and regulations.
He said: ‘As a group we are closely monitoring the Financial Conduct Authority (FCA) announcement in January 2024 to review historical commission arrangements in Motor Finance and the Judgement of the Court of Appeal on 25th October in respect of three motor finance cases.
‘As a dealer group fully regulated, initially by the FSA, and currently by the FCA, and as a distributor of the lenders point of sale offering, we have always operated fully to the conditions set out by the lenders and adhered to their commission models.
‘As a distributor of the lender’s products, we consider point of sale finance to be a valued service in a customer’s car buying journey.
‘The implications of the Court of Appeal judgement are far reaching and goes beyond the FCA’s review of commission models.
‘We along with the whole of the industry await the outcome of the Supreme court hearing and consequential risk of this judgement being applied retrospectively to motor finance cases.’
