Automotive business management specialist ASE reports that the ‘strong performance of the UK retail motor sector continued in March’.
Its UK Motor Retail Profitability Statistics for March 2013 show the average dealer made a profit of nearly £80,000 in the month, almost £15,000 up on March 2012.
The upward trend in ‘average dealer return on sales’ now stands at 1.25% on a rolling 12-month basis.
ASE says the improvement in performance remains totally dependent on new vehicle sales.
A statement read: “Whenever the market outperforms initial SMMT forecasts we see strong dealer profitability as a greater number of retailers earn top-band bonuses.
“Performance in the other profit centres remains depressed. Aftersales profitability remains static, although the increasing vehicle parc should bring increased volumes of traffic (and therefore hours sold) over the next few years.
“Used vehicle return on investment has increased. However, this is based on strong vehicle margins as a result of tight supply. Stockturn has lengthed recently and, unless this trend is reversed, it will reduce return on investment.”