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Dealers cash in on unofficial imports

Franchised dealers are responsible for a surge in unofficial imports from mainland Europe and Japan as they bid to win back customer confidence with promises of cheaper cars.

The British Independent Motor Trade Association predicts that around 140,000 new cars sold in the UK this year will be sourced from mainland Europe. This accounts for 16% of the market for retail cars.

Dealers are looking to benefit from a clause in Trade and Industry Secretary Stephen Byers' pricing order, which comes into effect this month, stating that cars imported from mainland Europe count towards annual sales' targets.

The publishers of consumer magazine Car Import Guide have added more pages to this month's issue due to demand from dealers advertising parallel and grey vehicles.

Alan Pulham, National Franchised Dealers Association director, said it was sad members had to sell unofficial imports. "But it shows they are resilient and pro-active," he added.

DC Cook, at No24 in the AM100, started importing new cars in April. It uses a network of dealers in Holland, Belgium and Germany through a partnership with Totalise, the UK internet car provider. Chairman Derek Cook claimed to be taking 20-25 orders a day.

"We have heard a lot of hype from Virgin Cars and OneSwoop but we are the leading retail importer in the UK," he said. "We have sold 3,500 imports since April, including Mercedes and BMW - we don't have those franchises."

Currie Motors, which used to hold the Ford franchise, is obtaining Focus, Fiesta and Ka in mainland Europe. The group, based in Twickenham, Middlesex, is selling them from a non-franchised site.

Managing director Joe Jaffe said: "We cannot afford to let other businesses take these sales. I think it will be short lived for us - it is a matter of time before volume manufacturers make price cuts."

Rover dealership Kernahan of Witney, Oxon, brings in used cars from Japan, which BIMTA estimates as the source of 60,000 unofficial imports this year.

Managing director Martin Kernahan said his import venture was "an incremental profit stream" helping to expand the business.

"We looked at other countries, like New Zealand, and found that once started, Japanese imports quickly became a tidal wave," he said. "Our service department also gets additional business from owners of Japanese imports."

Mr Kernahan focuses on sportscars and 4x4s - "you need high invoice models to make it worthwhile" - which are mostly 1994 onwards with some preregistered units.

He added: "Our biggest concern was to establish a proper parts supply, which can be a problem. We set one up with Japanese companies on a three-day delivery scheme."

Mr Kernahan sells an average of one Japanese import a week, but he expects the business to grow.

"Customers are attracted by the opportunity to have a different kind of vehicle that isn't generally available in the UK," he said.

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