Motor dealers have been urged to rethink their approach to creating new showrooms to save on property and development costs.
The advice follows news that European car sales recently dropped more than 6% and comes amid fears that UK dealerships could see worsening trading conditions over coming months.
The ending of Britain’s car scrappage scheme and tough austerity measures by the new coalition Government could contribute to weakening consumer demand.
According to De Boer – an international provider of semi-permanent buildings – temporary structures provide an alternative solution for the UK’s motor sector.
For dealerships needing to overhaul their showrooms, temporary structures allow the business to continue trading while improvement works take place. Similarly, dealerships with land allocated for new showrooms could trade on the site immediately until new build projects are completed.
Robert Alvarez, De Boer’s commercial sales director, said: “Even general improvement works to a car showroom have the potential of putting it out of action for six to eight weeks and in the current financial climate that is extremely tough.”
De Boer believes reduced capital costs, a faster return on investment and enhanced flexibility in being able to modify showrooms – coupled with technological advances in design and build processes – mean semi-permanent structures could be adopted by motor dealers looking to expand or refurbish existing facilities.
The company has already provided temporary sales facilities to dealerships selling models, including Mercedes-Benz and Kia and has worked more widely with clients such as Audi, BMW, Bentley, Ford, Volvo and Nissan.
Alvarez said: “The end of the UK’s scrappage scheme coincided with an immediate drop in the growth of UK car sales – falling by more than a half in April. There are signs from the rest of Europe that scrappage has contributed to sharp falls in vehicle sales. Germany, where a similar scheme ended last September, has recently reported a year-on-year drop in sales of more than 30%.”
According to Alvarez, other signals also suggest tough times ahead. “The European manufacturers’ association ACEA recently warned of continued uncertainty and a difficult 2010, reflecting the views of many analysts,” he said. “In the UK we have the additional pressures of VAT set to rise to 20% and the new coalition Government driving through a multi-billion-pound cost-cutting package. This will all have an impact on consumer confidence and on potential buyers’ willingness to pur-chase new vehicles. It’s essential that dealers respond to these pressures.”
Alvarez said with tougher trading conditions, temporary showrooms offer dealerships an immediate presence, a build time of just days or weeks plus reduced wholelife costs – while double-deck temporary structures offer the flexibility to provide additional space on the same footprint.
Dealerships that have already turned to De Boer include Ringways Motor Group, which struggled to find a suitable permanent building in Doncaster after being awarded a new franchise by Kia Motors UK. A 380-square-metre temporary showroom, complete with glazed frontage, roller doors, hard-wall interiors and specialist lighting, was in place within just seven days.