Wednesday 3 February 2010, 09:56

Dealers should refocus on new car sales during the first quarter of 2010.

 

 

Many dealers have put non-scrappage scheme new car sales on the back burner to concentrate on aftersales and used cars during the recession.

However, figures and anecdotal evidence suggest that the new car market is now beginning the long climb towards a recovery, says Colin Bruder, managing director of motor industry consultancy Network Automotive. Dealers need to ensure that they have structured plans in place.

 

“Dealer profitability has been heavily biased towards aftersales and used car sales in the last 18 months, and dealer managers have been focusing their attention on getting the most out of these sectors, sometimes just to survive," he said.

 

“New car sales have often been neglected as a result or, where dealers have successfully used the scrappage scheme to drive sales, strategies have been heavily skewed towards generating sales through the Government subsidy.

 

“Now, what dealers need to do is formulate plans to maximise new car sales in what remains a tough market, but one which shows some signs of recovery.”

 

Bruder explained that dealers needed to look closely at all the potential customer groups open to them, how the models they sold could be presented in these sectors, how best use could be made of finance and other offers, and how to generate additional revenue from add-ons such as warranties and service plans.

 

He said: “Dealers really need to have a fundamental rethink where new car sales are concerned.

"Depending on their franchise, some are facing very different scenarios compared to pre-recessionary times.

"In the future, they may find that they are selling different models to different customers in different ways.

 

“In addition, there are several unknowns on the horizon, such as the arrival of electric and other alternative fuel cars.

"Dealers need to have a clear strategy in place, implement it thoroughly and monitor their results regularly.

 

“Many manufacturers have quite aggressive sales targets in place despite continuing market fragility.

"Whether these are realistic remains to be seen but what is certain is that there will be renewed accent on new car sales.”

 

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