The December issue of AM - Automotive Management is out now (scroll down for a preview).
Carmakers’ targets and incentives have driven much of their dealers’ focus onto new car sales in 2014, but the used car market, still enjoying high values, has remained a critical profit centre nevertheless. However, our latest poll of dealers suggests many expect their used car margins to be squeezed.
With most retail sales generating a part-exchange, the decision whether to refurbish and retail or trade it out can be difficult. Some dealers told AM they’ve been making £400 profit per unit simply putting trade-ins through auction, yet our feature shows that other dealers see greater value in refurbishment to refill the forecourt.
Sourcing replacement retail-ready stock has been an issue since the recession ended and days in stock have extended as a result. Yet now that the market is seeing a little more volume, the experts we’ve spoken to in our stocking feature agree that a faster turn of cars could drive profits up. Isn’t it time to review that stocking policy?
One dealer group which has to ensure its sales process is slick is Macrae & Dick, the subject of our Face To Face interview this month. Managing director Andrew Grzesinski is running a fascinating and very profitable business, one which certainly goes the extra mile for its customers in the north of Scotland, even if there’s a ferry crossing or B&B stay involved.
One quirk of Macrae & Dick selling cars in a territory the size of Switzerland is that it operates an American-style model. Deal on the day, as Grzesinski calls it. We’d call it a glimpse of the future.
Elsewhere in the December 2014 issue of AM – Automotive Management
♦ Glass’s head of valuations Rupert Pontin assesses the impact of soaring new car registrations on ‘late plate, low mileage’ car values.
♦ Professor Jim Saker argues that car dealers and manufacturers have not yet cracked how to market to digital-savvy youth.
Also: The AM100 autumn financial update; Drive more efficiency in your dealerships with IT systems; Analysis and advice from our experts on engaging the used car buyers of the future in our report on the AM Used Car Market Conference.
Coming up in the January 'Fit for '15' issue of AM – Automotive Management
♦ Face to face: Lookers Chief executive Andy Bruce and managing director Nigel McMinn reveal how the top 10 AM100 group’s brands and online operations are preparing for growth in 2015.
♦ The motor retail minefield: We look at what effect regulation and legislation is aiming to have on the car sales and service sector, and where the pitfalls may be for dealers.
♦ FCA regulation: An insight into the latest developments in the Financial Conduct Authority’s supervision of consumer credit and insurance in the UK, and how suppliers are helping dealers with approvals and compliance. PLUS: Full coverage of the expert advice from AM’s F&I Compliance Conference.
♦ The Audi TT reviewed: The UK is the world’s largest market for current Audi TT sales, so the new version has big boots to fill.