BDO’s eighth motor salary survey has revealed that the average car retail employee’s annual remuneration package has increased from £40,000 to £41,000 in 2018.
The survey revealed that the biggest overall wage increases have been in dealerships aftersales departments where productivity and profitability have remained constant in a year which has seen margins squeezed in both new and used car sales.
BDO partner Steve Le Bas said that the 3% increase year-on-year – which was ahead of the 2% seen in 2017’s survey – had also come as a result of retailers efforts to retain the best staff in an era of high employment.
Le Bas said: “Our expectations for the coming year are for further increases, however in light of current industry trading and the general economic uncertainty this might be at lower levels than in 2017/2018.
“It will also be interesting to see further developments in the shift towards higher basic pay and lower commission structures as groups put greater focus on ‘selling’ online, potentially meaning less need for commission-based salespeople to ‘make the sale’.”
BDO reported that the average base salary for all 27 dealership positions surveyed, across a total of 365 retail sites, was £36,889 (2017: £34,623), with a further £17,256 receivable in commissions and benefits – meaning that around 30% of earnings continue to be commission-driven.
The average remuneration received by a managing director or chief executive rose to £247,000, up 18.8% on 2017’s £207,000, which followed a decline from 2016’s £208,000 total.
Finance directors continued to see their remuneration levels rise, from an average of £140,000 in 2016 to £144,000 last year and £151,000 in 2018, according to BDO’s research.
Dealer principals, meanwhile, made and average of £111,000 in 2018, up 6.7% on last year’s average, which came after a dip from £116,000 in 2016.
While the dealership’s part department continues to employ some of the lower earners in many car retail businesses, wages were increased by 10.1% to an average of £30,000 this year (2017: £27,250), with service staff realising a 7.4% increase to £32,750 (£30,500).
BDO’s survey also analyses staff turnover and the average hours worked across job roles. The report noted: “With regards to staff turnover, the average length of service at a dealership has increased to eight years, with key executives continuing to be at dealerships for in excess of ten years on average.
“The average number of hours worked by an employee per week was consistent, being approximately 41 hours (2017: 41 hours).
“In addition, employees receive an average holiday entitlement of 24 days (2017: 26 days), 40% of employees receive car benefits (2017: 42%) with 73% of employees receiving other benefits (2017: 74%).”
Le Bas said: “While the survey primarily takes into consideration remuneration in the form of financial rewards, we recognise the value of a number of other innovative strategies available to reward staff and increase morale.
“These strategies often involve little financial expense and have positive long term benefits in terms of engagement and staff retention.”