Almost half of car dealers expect to deliver growth in the coming 12 to 18 months despite the uncertainty surrounding the impending General Election, Brexit and the roll-out of electric vehicles (EV).
Research carried out for Startline Motor Finance by APD Global surveyed 57 dealer businesses including franchise groups, independents, car supermarkets and online specialist brokers and found that 47.1% believe that the market will see growth to some degree.
Nearly a third (29.1%) see the market as unchanging and just over a fifth (22.8%) predict that the market will contract.
However, none (0.0%) of the respondents to the question thought there would be substantial negative growth.
Startline Motor Finance chief executive, Paul Burgess, said: “One of the truisms of the motor industry is that, even when times are difficult, people still need cars to live and to work – and even when new car sales suffer, used sales tend to be resilient.
“To some extent, used cars are a countercyclical business and there is every reason to believe that the industry will be very busy over the next couple of years, whether the many possible macroeconomic difficulties materialise or not.
“Dealers clearly share this view but it is perhaps surprising the degree to which they view this is a moment when growth – even substantial growth - is possible. Really, they are overwhelmingly optimistic.”
Forecasts issued by the Society of Motor Manufacturers and Traders (SMMT) back in October predicted new car registrations of 2.2 million in 2020, down 4.4% on its 2019 outlook level.
It expects diesel car volumes to decline 10.7% on 2019 – to 0.547 million – as electric vehicles (EV) registrations rise by 89.3%, pushing market share up to 2.9%.
PHEV registrations will rise 69.5%, pushing market share up to 2.2%, meanwhile.
Burgess said that research conducted by Startline had indicated that dealers were ready to invest in their used car operations, particularly when it came to online finance and sales.
Clearly there is a requirement to invest in EV infrastructure too.
Burgess said: “It is possible that new car sales will fail to recover or even continue to fall in the short-medium term, so putting money into maximising the possibilities of used car sales at this time certainly makes sense.
“From a Startline point of view, we continue to have conversations with dealers about how the kind of flexible motor finance we provide can play a part in their plans heading into 2020 and beyond, and many are rethinking their lending panels are a result.”