The Inchcape dealer group – number four in the AM100 – has struck a deal with Tesco that will see it promote exclusive new car offers to 15 million of the supermarket’s Clubcard holders.
Neither company would reveal how many cars are expected to be sold through this new channel but Inchcape says it will be a substantial number.
“With 15 million Clubcard holders we are hoping to sell thousands of new cars in the coming months,” explains Steve Archer, director of innovation and strategy for Inchcape.
The opening offer sees a Ford Ka discounted by almost 25%, a Ford Fiesta with more than £3,000 off its recommended price and a Ford Mondeo with £5,000 – or more than a 25% – discount.
Of the three manufacturers initially represented in the new deal – Ford, Toyota and Volkswagen – the heaviest discounts are all on Ford cars.
This is despite Ford announcing that it is determined to end heavy discounting by its dealers.
Ford managing director Nigel Sharp stated only last month that high discounts “caused confusion” and that Ford “together with our dealer partners are determined to change that formula".
Inchcape told AM that the deal was struck with the blessing of all the manufacturers involved.
“We would not do this without their support,” a spokesman said. “This has no relationship with Ford’s announcement.”
Ford responded saying the partnership between Inchcape and Tesco “is a good one”.
It said its full price realignment programme does not come into effect until the start of August and so the discounts being offered in the new deal do not contravene its new pricing policy.
“We can’t dictate the price at which dealers advertise,” said a Ford spokesman.
The discounts available to Clubcard holders are greater than they could get in the showroom, says Archer.
“Tesco’s Clubcard holders can now obtain incremental discounts on new cars above the level they would be able to get in showrooms,” he said.
“For any Clubcard holder in the market for a new car it makes absolute financial sense. We have chosen to launch the partnership with more volume-orientated brands with attractive pricing and discounts at above showroom levels.”
The advantages of the new deal to Inchcape are significant: not only is this an exclusive sales channel with a massive audience but it is a way for the dealer group to move stock quickly either to meet targets or for other reasons like selling on run-out stock.
As a result it will change the cars on discount regularly.
“Offers will vary week by week manufacturer by manufacturer and will depend on availability and the commercials relevant to that vehicle,” said Archer.
However, the opening deals are no on run-out models – the Mondeo for example is one of the most popular retail models at present.
“We don’t want to put on vehicles that are not popular,” said Archer.
“We don’t want to disappoint Tesco.”