Manufacturers’ and sector suppliers’ growth aspirations look set to be hampered by the intensifying trend in the contraction in the number of dealer outlets combined with likelihood of reduced new car sales until at least 2015.
Exclusive research by AMi reveals a continuing reduction (and consolidation) in the UK franchised network footprint.
Detailed findings from AM’s web-based data and insight business, reveals a fall in the last 10 years of total dealer holding companies, reducing the number of suppliers prospects and putting an ever-increasing emphasis on ensuring effective customer relations and prospecting.
Ten years ago the total was 2,730 of which 463 had two or more sites.
Five years ago the totals were 1,793 and 571.
AMi puts the total number now at 1,777. Of these, 518 have two or more sites.
The number of UK franchised outlets continues its fall from the first recorded high of 10,201 in 1975 to the current count of 5,579, a fall of 5% since AMi records began and since the end of 2011, 1%, when the total was 5,640.
Franchised dealer network size
The 10-year trend shows the number of franchised dealer and non-franchised dealer outlets exiting the market at over 2,500.
When taking into consideration a number of market indicators, including the SMMT sales forecast and the ageing car parc, it could be argued that the franchised dealer sector is over-subscribed, in addition the rate of decline of non-franchised dealers has accelerated in recent times.
With challenging trading conditions likely to continue, the trend of market consolidation is also likely to continue. An extrapolation of the data indicate that a combined decline of around 500 franchised and non-franchised dealer trading outlets could exit the market over the next three years (to 2014).
There is a parallel slide in the number of used car sites identified by AMi, from 5,825 in 2002 to 4,431 in 2012, together with a predicted total of 4,201 in 2014.
Market trends: 10-year variance (2011 vs. 2002)
Franchised outlets (incl. LCVs): -17%
Non-franchised used car sites: -22%
Prediction for the years 2012 to 2014 is based on an average annual decline of 1.09% (franchised) and 2.62% (non-franchised) over the last five years.
This and further analysis on the sector health is included in the AMi 2013 UK Franchised Dealer Report.
> data on the influence of the AM100 on the number of franchised outlets
> the penetration of owner/operators by manufacturer brand
> franchised sales outlets with registration totals and sales per outlet trend figures compared to 10 years and five years ago
> pre-registrations impact
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