F&I Management & Training

Norwich dealer Duff Morgan is fighting the downturn with a big success in used car sales.
The Citroen dealership sold 71 used cars in January, compared to its average of 50 sales per month.
Jeremy Trett, dealer principal, told the Norwich Evening News: "All we hear about in the motor industry is how everybody is going to go bust, but we've had a storming month."
It's not known how well the dealership's new car sales went in the same month.
Trett said there is "pent-up demand" because consumers had been putting off changing their car during the "doom-mongering about the recession".
"It's not all doom and gloom in the motor industry."

DATED: 05.02.09

FEED: AM

"With the economy as it is, customers are keen to look at alternative forms of credit and it is in the best interests of the industry as a whole that we get a reasonable rate of return, to ensure that suppliers will be here to support the industry in 12 months’ time."


Although 2009 is only a few weeks old, the seasonal festivities of last year already seem like a distant memory.As dealers are acutely aware, the first quarter of the year is a key time to clinch valuable sales and so businesses must be ready to hit the ground running this month.
Adopting a positive attitude is the first step on the road to financial recovery.As the UK’s No.1 independent provider for point-of-sale motor finance, Black Horse is very much at the heart of this industry and therefore is also impacted by the changes felt last year.With the economy as it is, customers are keen to look at alternative forms of credit and it is in the best interests of the industry as a whole that we get a reasonable rate of return, to ensure that suppliers will be here to support the industry in 12 months’ time.The good news for dealers is that PoS penetration is increasing, which is a reflection of the lack of available credit from direct lenders and the continuing availability and convenience of credit in showrooms.For the customer there are many reasons to choose finance at the point of purchase, rather than shop elsewhere. Benefits offered by the dealer and Black Horse include easily arranging finance payments via a ‘one-stop-shop’ and the reassurance of dealing with the UK’s market leader, part of the UK’s most trusted bank – a brand they can trust.Black Horse is committed to this industry for the long term and we continue to actively recruit new dealerships. We are also focused on supporting and helping our existing dealers with stock funding, as well as supporting a high-profile PoS presence in their showrooms. If the last year has taught us anything, it’s that no-one – economists and politicians included – can predict with any great deal of certainty what will happen in the months ahead. All the signs point to the first half of 2009 being pretty tough, but if we take an optimistic approach then hopefully we can lay the foundations for recovery further down the road.

DATED: 05.02.09

FEED: AM

Bank of England Reduces Bank Rate by 0.5 Percentage Points to 1.0%

The Bank of England’s Monetary Policy Committee today voted to reduce the official Bank Rate paid on commercial bank reserves by 0.5 percentage points to 1.0%.

Bank of England Reduces Bank Rate by 0.5 Percentage Points to 1.0%

DATED: 05.02.09

FEED: BoE

It is understood that it can no longer meet its debt repayments from the MBO."

A sale of part of Camden Group Services is expected to be completed this week in order to rescue the company from collapse.
The group has been placed into administration by business restructuring specialists Zolfo Cooper, formerly Kroll which will continue to trade the business as a going concern while it explores options for its future.
Camden Group Services employs approximately 800 people and is expecting to make a "small number" of redundancies.
AM understands from several sources Camden Group Services is in financial difficulties and is in talks with potential new owners for some or all of its 14 dealerships.

Camden Group Services, formerly known as Camden Corporate Fleet Services, split from Camden Motor Group in September 2007 in a £66m management buy-out.
It is understood that it can no longer meet its debt repayments from the MBO.
Nissan, with which Camden Group Services has two sites, said it expects representation to continue in those locations but would not confirm that Camden will remain its partner.
AM has tried to contact Camden Group Services chief executive Ian Wardle without success.
A top 10 AM100 dealer group and one of the UK's largest fleet suppliers, Camden Group Services turns over £910m annually.
Camden Motor Group, headed by Paul Dunkley, is not connected to Camden Group Services.

DATED: 04.02.09

FEED: AM

"Wilson said that in circumstances like these it was usually best to reduce the scale of the business, and to stay with the original backers. "

Westdrive Automotive Group – Kia’s second best dealer in a global proficiency test in 2005 and its biggest in the UK – has been forced into administration because of mounting debts after ill-fated expansion.Growth had enabled Westdrive to increase its turnover to £20 million by December 2007, but its collapse left debts totalling around £870,000, according to administrator Baker Tilly.Owner Jason Westwood and his backers have now executed a management buy-out from Baker Tilly, safeguarding 20 jobs at its Braintree base, near Chelmsford.
The new business has debts relating to Braintree, but is relieved of other debts run up by satellite points at Edmonton and Romford in north and east Greater London, now closed.Mark Wilson, partner at Baker Tilly, Watford, said: “Westdrive expanded at the wrong time and ceased to be viable. It struggled to make money and was then caught by the economic downturn. In December the directors realised they needed to call in administrators.”Wilson said that in circumstances like these it was usually best to reduce the scale of the business, and to stay with the original backers. Westwood declined to talk to AM but told an Essex newspaper that administration ”was a process that we had to go through to make sure we could hold on to what is a successful dealership.” Stephen Kitson, Kia UK spokesman, said: “Westdrive moved into an area where it found rents and rates were astronomical. This put a strain on the business. Jason Westwood took action to protect the Braintree core of the business, and has had our support throughout.”Westdrive would continue to be an integral part of Kia’s planned sales expansion in the UK, he added. Around 15 dealers would join the network over the next few months, some replacing outgoing retailers. There were no immediate plans to fill the Romford and Edmonton points.The latest Kia dealership to collapse is Aln Motor Company in the north-east.
The failure is believed to be linked to problems with Aln’s fuel station business.

DATED: 04.02.09

FEED: AM

"Keep the car owner as a service customer and there’s a better chance of selling them their next car. "
The internet has partially severed the link between dealership and customer.
With car buyers carrying out the majority of their research online, the opportunity for the dealership to grab them at the front door has diminished.
Now it’s more about how good your website is and how you react to email enquiries; once anyone crosses the threshold they are already a long way down the buying route.
They still need converting, of course, but with customers shopping around online instead of on-site at the dealership, the chances to convert are fewer.
Capgemini reported that customer loyalty to UK dealers fell from 46% in 2005 to 32% two years later largely due to the impact of the internet.
It’s even more imperative, therefore, that retailers offer their customers an enjoyable experience whether buying or taking the car for service or repair.
It’s about maximising every opportunity when you do see the customer – to keep them coming back for more.
Great customer service will not automatically translate into re-purchase, although that can certainly happen.

DATED: 04.02.09

FEED: AM

CAMDEN Group has been placed in administration, but will continue to trade as a going concern.
A statement from the firm said there would be a small number of redundancies from its 800 staff
A statement, released Tuesday afternoon, said: ‘Today, Alastair Beveridge, Stuart Mackellar and Fraser Gray, partners at Zolfo Cooper were appointed as Joint Administrators of Camden Group Services Limited, Camden Fleet Solutions Limited, Camden Bidco Limited, Camden Retail Limited and CCFS (2005) Limited (‘Camden Group’).
‘Headquartered in Leighton Buzzard, Bedfordshire, the Group operates two distinct divisions: Camden Fleet Solutions, an automotive fleet services provider; and, Camden Retail, which operates a range of automotive retail franchises as well as Camden Carstore, a used car centre.
‘The Joint Administrators will continue to trade Camden Group as a going concern while they explore options for its future.’
Camden Group employs approximately 800 people across its head office, fleet services and retail businesses.
Alastair Beveridge, partner at Zolfo Cooper added: ‘Despite having well-established businesses in both the automotive fleet services and retail franchise sectors, Camden Group has not been able to escape the extremely tough trading conditions that the sector as a whole is battling through.
‘We will continue to trade the business as a going concern as we assess options for the business.’

DATED: 04.02.09

FEED: CDM

FIVE times running… that’s how many times Black Horse Motor Finance has been voted top by the ITM.
2009 marks the 5th time running it’s won the ‘UK Independent Motor Finance Company’ honour – awarded by the Institute of Transport Management.
What’s key to this sustained success? According to the ITM, Black Horse’s ‘exemplary role as a major player in the finance sector.
‘It has proven itself as the number 1 independent finance provider.’ Patrick Sheedy, ITM PR director, also commended the company’s awareness of the need to drive product awareness.
‘In its commendation of Black Horse Motor, the Institute is paying tribute to one of the finest motor finance providers in Europe,’ he said.
‘Black Horse boasts over half a century of experience in financial services and is the foremost provider of finance at point of sale in the UK.’
Naturally, Black Horse MD Chris Sutton was delighted. ‘This is a great confidence boost for the start of a new year, and will help to further motivate staff to maintain our high standing within the industry over 2009.
‘The fact that we have won this award for the past 5 years demonstrates that we are consistently the market leader for finance in the motor industry, a position which we are confident will not change in the years ahead.
He’ll get his hands on the trophy at an awards ceremony next month. Or, rather, get to keep the one he already holds!

DATED: 04.02.09

FEED: CDM

Key people from the car industry in the West Midlands are holding a summit in Birmingham. The meeting at the International Convention Centre (ICC) will aim to improve vehicle sales and protect jobs during the recession. David Smith, the Jaguar Land Rover chief executive, union leaders and industry experts are among those attending the event. The government has outlined a support package for the UK car industry. The region's car industry has seen hundreds of job losses and there have been shutdowns at several plants in a bid to cope with falling demand. Last month, Business Secretary Lord Mandelson outlined the package which he said would help the industry weather the downturn in the global economy. It includes a scheme to unlock £1.3bn of loans from Europe for car manufacturers and major suppliers.

DATED: 03.02.09

FEED: AW

Ford and Vauxhall have both said their UK car prices are going up, despite falling sales and news of government measures to support the sector. They both blame the weakness of the pound - much of their manufacturing is carried out in the eurozone, so sales in pounds are worth less to them. Ford is putting up the prices across its range by an average of 4.7%. Vauxhall is increasing the prices of all models except the Vectra and VXR8 by an average of just under 5%. "We have to increase our prices," said Vauxhall spokesman Simon Hucknall. "It is essential - it is not desirable, but it is essential." Ford said the weakness of the pound had put it under "severe economic pressures". Loan package Car sales in the UK fell 21.2% in December, compared with the same month the previous year. Last month, the UK government announced measures designed to support to support the car industry. This included guarantees to unlock loans of up to £1.3bn from the European Investment Bank, as well as a further £1bn in UK government loans to fund investment in greener vehicles. Both Ford and Vauxhall, which is owned by General Motors, are also benefiting from the US Congress's $14bn (£9.8bn) bail-out of the car industry. Buyers' market The list prices given by car manufacturers comprise the wholesale prices they charge to the dealers plus an assumed margin for the dealer. The dealers themselves may charge more or less than the list price and there have been signs of showrooms having to cut their prices and margins significantly to try to clear their stock. "With fields and car parks right across the country piled high with unsold cars, it may come as something of a surprise to hear that both Ford and GM are planning to raise the price of all cars they sell in the UK," said Howard Wheeldon of BGC Partners. "Of course, announcing a price rise is one thing but putting it into effect quite another. From a customer perspective, there has probably never been a better time to buy a car." Dealers are still struggling with the problem that many of their potential customers are having trouble taking out car loans as a result of the credit crunch. More increases? The decline in the value of the pound against the euro has been dramatic, falling from 1.34 euros to the pound at the start of 2008 to a low of 1.05 at the end of the year. It is a particular problem for carmakers because even those that assemble their cars in the UK use parts manufactured in the eurozone, for which they have paid in euros. Ford said in a statement that more price rises were likely unless the pound strengthened against the euro. It has not increased prices anywhere else in Europe, except Russia, where the weakening rouble has presented the same problem. Ford's prices in Russia have gone up by 4.5% on average.

DATED: 03.02.09

FEED: AW

Motor retailers in Ireland have repeated calls for government support there after January's registrations plunged 66.5%.
The Society of the Irish Motor Industry (SIMI) said 3,000 jobs were lost in the last quarter of 2008 and more will follow if their is no support.
Alan Nolan, director general of SIMI, warned that Government revenue from new car sales fell from 2bn Euros in 2007 to 1.5bn Euros last year and government tax revenue from new car sales this year could drop to €500 million.
The SIMI's proposed rescue package for the Irish motor industry includes the introduction of a new scrappage scheme for cars 10 years or older.
SIMI has also asked for a review of the current practice on imposing VAT on the trade-in price of cars when the sale price is lower. For example, a car bought or accepted as a trade-in by a dealer may be have been valued at €20,000 but in the current climate it’s sold at €10,000. The VAT, however, is paid on the initial value.
Finally, the industry group is seeking increased enforcement by Revenue officials of the rules on re-registering imports and a crackdown on illegal roadside car dealers.

DATED: 03.02.09

FEED: AM

CAMDEN Group Services, a fleet provider that also runs 7 new car dealerships, risks collapse this week.
The Times reports that the Group, could go into administration in the next few days – putting 800 jobs at risk.
Camden supplies cars to most of the major vehicle rental companies, including Avis, Europcar and Hertz.
However, it also runs 7 new car dealerships, in Croyden, Luton and Northamptonshire. These franchises sell Fords, Nissans, Renaults and Vauxhalls.

In 2007, it made a profit of £4.6 million. However, it was also bought out in 2007, using a large proportion of finance. The credit crunch has meant it is very hard to service this debt.

We will be following this depressing development throughout the week…

DATED: 03.02.09

FEED: CDM

AUCTION prices for used cars rose by nearly 6 per cent, as post-Christmas demand enjoyed a boom.
Manheim found that the first few weeks of 2009 have seen an increase way beyond any normal seasonal uplift.
Buyers are literally fighting over stock, it reports!
This has pushed the average wholesale used car price up to £6054 – a rise of 5.8 per cent in January. Compared to a 3.1 per cent FALL in December.
It’s certainly taken everyone by surprise. That’s why Manheim’s urging caution, ‘as retail dealers settle down to the task of finding new customers for this stock’.
Mike Pilkington, MD of Manheim Auctions & Remarketing said: ‘There is no doubt that dealers had reduced their stocks pre-Christmas – a lot of this current demand has been driven by the need to replenish empty forecourt spaces.
‘Although there appears to be healthy consumer interest, it remains to be seen for just how long this will be sustained. We have also seen many new trade buyers coming to auction, and this has contributed to the huge rise in auction conversion rates.
‘The more buyers bidding, the higher the prices.’ It’s also led to some of Manheim’s sites recording 100 per cent conversion rates. And the Colchester branch smashed the 6000-unit sales barrier in a month.
As for specific sectors, January really was a complete about-turn.
• Fleet: values ROSE by 9.0 per cent (£425). They FELL by 3.1 per cent (£149) in December.• Dealer: values ROSE by 1.9 per cent (£31). They FELL by 4.9 per cent (£82) in December.• Manufacturer: values ROSE by 3.2 per cent (£284). They FELL by 5.0 per cent (£465) in December.
Specific car rises? Eyes continued to be opened…
• Small Hatchback Fleet sector: UP 10.6 per cent• Large Family Fleet sector: UP 10.5 per cent• Soft-Roader Fleet sector: UP 16.3 per cent• Compact Executive Dealer sector: UP 8.0 per cent• MPV Dealer sector: UP 7.5 per cent• Off-roader Dealer sector: UP 26.2 per cent

DATED: 03.02.09

FEED: CDM

Motor retail accountancy practice Trevor Jones is in merger talks with sister company ASE.
Robert Jones, managing director of ASE, which provides composite and business management services to dealers and carmakers, said: “We are currently exploring in serious detail the option of merging the two businesses to provide a superior service to all clients.
"We hope to announce further developments within the next six weeks as the project progresses.”
Both Trevor Jones and ASE already operate under the same management team.

DATED: 03.02.09

FEED: AM

A sale of part of Camden Group Services is expected to be completed this week in order to rescue the company from collapse.
AM understands from several sources that the group is in financial difficulties and is in talks with potential new owners for some or all of its 14 dealerships. Business restructuring specialists from Zolfo Cooper, formerly Kroll, have been brought in by its management.

Camden Group Services, formerly known as Camden Corporate Fleet Services, split from Camden Motor Group in September 2007 in a £66m management buy-out.
It is understood that it can no longer meet its debt repayments from the MBO.
Nissan, with which Camden Group Services has two sites, said it expects representation to continue in those locations but would not confirm that Camden will remain its partner.
AM has tried to contact Camden Group Services chief executive Ian Wardle without success.
A top 10 AM100 dealer group and one of the UK's largest fleet suppliers, Camden Group Services turns over £910m annually.

Camden Motor Group, headed by Paul Dunkley, is not connected to Camden Group Services.

DATED: 03.02.09

FEED: AM