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Inchcape proves stable in unsettled market

Inchcape continued growth in market share globally was strongly reflected in the financial results for 2009 published on March 10.

Yet there was no profit growth in absolute terms.

Most attempts by large dealer groups to become international distributors and retailers have failed, but Inchcape, under Andre Lacroix, has stuck at it and is now big enough and sufficiently well spread to be able to turn the cross-cancelling ups and downs into a reasonably stable business.

Though some markets such as Russia were decimated by the recession, total world car sales at 63 million were only 3.9% down on the previous year.

In the UK Inchcape managed to swing last year’s loss of £5.7m to £46.7m of trading profit.

That outperformed the market which fell by 6.4%, with a like-for-like sales decline of 3.9%.

The reduction on cost base and successful use of the scrappage scheme were the two main things that helped the growth.

Lacroix is still absorbed by the lack of customer care in the motor industry.

“Our industry is generally not known for the quality of its customer service and our approach is based on a simple insight: if we look after people and their cars better than the competition, customers are more likely to choose us; and if we perform demonstrably better for our brand partners than our competitors, manufacturers are more likely to expand their global business with us.”

He is not concerned with modesty when he reviews the progress made: “We are the most advanced company in our industry in implementing cutting edge retail techniques and technologies.

"Among other initiatives we manage a continuous mystery shopper programme to maintain the highest standards of in-centre service.

“We interview around 12,000 customers every month to identify precisely what we do well and what we should do better. We constantly track a wide range of customer metrics – from footfall and test drives to leads.”

Inchcape now has scale businesses in 26 developed and emerging markets and is “a leader” in 14 of these, in his judgement.

Inchcape has appointed two new non-executive directors to the board.

Nigel Northridge is currently chairman of Paddy Power whose customers gamble their money.

Alison Cooper is currently chief operating officer of Imperial Tobacco.

> Inchcape worldwide: an analysis of the global dealer group appears in the March issue of AM

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