Autocar

Dealers open doors as car sales rise at last

- JOE HOLDING

NEW CAR REGISTRATI­ONS have risen for the first time since the start of the Covid-19 pandemic, with 283,964 new vehicles hitting UK roads in March – 29,280 more than in the same period in 2020.

This first sign of growth is positive news for the industry, albeit with the caveat that sales tumbled by 44.4% in March last year as the country entered its first lockdown.

Dealership­s reopened on Monday for the first time since early January, when all non-essential retailers were forced to close their doors once again in response to an alarming rise in infections.

The Society of Motor Manufactur­ers and Traders warned that the latest figures are still 36.9% down on the 10year March average and that the shortfall in the first quarter of this year has already cost the industry around £1.8 billion.

“The past year has been the toughest in modern history and the automotive sector has, like many others, been hit hard,” said SMMT chief executive Mike Hawes.

“But a strong and sustainabl­e market is possible if customers are attracted to the choice and competitiv­e offers the industry is able to provide within the safest of showroom environmen­ts.”

Autocar spoke to Robert Forrester, CEO of dealership chain Vertu Motors, about what the industry can expect now that dealership­s are up and running once again.

Are you optimistic for the future?

“I think we should feel pretty optimistic. March was actually a successful month for the sector. Yes, the private new car market was down 4%, but bear in mind that no one has been in a showroom or had a test drive for three months. I thought that was a near miracle, actually.

“The April market will be quite strange, but if you look at the reopening of Scotland – which reopened on 5 April – we did see an increase in business from then onwards.

“Our Scottish dealership­s on 5 April were very much top of our league in sales. People have been holding off wanting test drives, which is fairly obvious really, particular­ly on new cars and new powertrain­s, electric vehicles and things like that. So we fully anticipate being busy in England.”

What will the following months look like?

“There are going to be quite a lot of accidental savers looking to spend money, wanting a car, wanting a bit of excitement. It won’t be as rampant as coming out of the first lockdown, but it will be quite considerab­le.

“Order banks for retail, I suspect, are quite low. Having said that, there are lots of people waiting for a test drive. The key issue is: will we have time to deliver the new cars before the month ends? But I could see it being quite robust for a few months.”

Is ‘click and collect’ here to stay?

“The technology – which the major groups have got now – is much better than it was, so it will have its place. But I think there will be a quite substantia­l majority of the population who will do a lot of research up front and contact us via the internet but actually come in, test drive and then buy the car.”

❝ I’m optimistic for the next 15 years. The pandemic will not bring on the death of the dealership ❞

What does the long-term future for dealership­s look like?

“We continue to make good margins. If you were starting from scratch, would you have dealership­s? And I’ll give you two pieces of evidence. One: Tesla, which is growing its number of dealership­s. And two: Cazoo, the great digital hope, which again is developing sites across the UK.

“You’ve got to have bricks and clicks. Assuming that we’re competent, productivi­ty is high and we have the right partners, I’m optimistic about the franchise model for the next 15 years. The pandemic will not bring on the death of the dealership. Quite the reverse: the future is dealership­s.”

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Dealers hope to benefit from a post-lockdown sales boost
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Vertu boss Forrester predicts “robust few months” of car sales

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