F&I Management & Training

Independent used car dealers have topped the Consumer Direct list as the most common customer gripe for the fourth time in a row.

Franchise dealers were also named and shamed within the top 10 listing. However, HPI the vehicle information company, said it was a minority within the trade that is casting a shadow over the industry as a whole. HPI believes that has its risks whether a consumer is buying from a dealer or from a member of the public.

HPI is advising customers to check if a trader is registered with a trade association that has to follow a code of practice.

Nicola Johnson, consumer services manager for HPI, said: “Once this is established buyers should do some groundwork before they visit a trader so that they have a good understanding of what make and model of car they can realistically afford, and what sort of condition they should expect that vehicle to be in for the price they are willing to pay.

"When you visit dealers, ask them a few basic questions to help you separate out the good from the dodgy ones. This can help you save time, trouble and money. Under the Trade Descriptions Act 1968, all descriptions applied to a vehicle must be true.

“For instance, a car cannot be advertised as having had one careful owner if it has actually had three, so ask to see the vehicle's paperwork such as V5 and service history for yourself."

Sue Robinson, director of the Retail Motor Industry Federation (RMIF), said they were working closely with the Office of Fair Trading on a study into the second hand car market and reported that in many cases a complaint has arisen as a result of a breakdown in communication or a misunderstanding between the customer and the trader.

DATED: 29.01.10

FEED: AM

Ridgeway Group has renamed the two Volkswagen sites it acquired from Motorworld as Ridgeway Oxford and all staff have transferred across as part of the deal.

The takeover, which also includes Motorworld’s preparation and bodyshop at Enstone just outside the city, increases Ridgeway’s Volkswagen sites to five – the two Oxford dealerships joining Newbury, Reading and Wantage.

Currently ranked as the 25th largest motor retail group by in the AM100, Ridgeway already runs Audi and Skoda franchises in Oxford and has Mercedes-Benz passenger car and commercial vehicle operations, as well as a Smart retailer across the south coast.

Ridgeway’s total workforce has now increased from 650 to 740 employees as a result of the acquisitions.

David Newman, Ridgeway group chairman, said: “The acquisition of the two Oxford sites is a perfect strategic fit for us in terms of their locations being contiguous to our existing businesses.”

John O’Hanlon, Ridgeway chief executive, said: “In terms of excellence and experience, we have inherited superb teams at both our new sites.

“We welcome them all to the Ridgeway family and look forward to them providing customers with the outstanding levels of service that our Group is renowned for.”

DATED: 29.01.10

FEED: AM

Vauxhall/Opel may not get all the 3.3 billion euros it wants for a rescue refinancing, according to General Motors Europe boss Nick Reilly.

If GM is unable to gather all the funds it requires, then the restructuring of the Vauxhall/Opel business would need to be more severe than the 9,000 job cuts and 20% cut in manufacturing that is being planned.

Mr Reilly is hoping that a number of European governments, including the UK, will contribute around 2.7bn euros in aid, with GM pumping in 600m euros.

However, Mr Reilly is cautious because complex negotiations must be conducted with each country and then a deal signed off by the European Commission.

He said: "Maybe we will not get the full 2.7bn euros, but I do expect we will receive a significant amount."

Mr Reilly hopes to announce the restructuring plan within the next two to three weeks.

Hundreds of jobs are under threat at car maker Toyota after it announced a "surplus" of 750 posts at its factories in Derbyshire and Flintshire.

Managers said they were reviewing the situation but were not currently considering compulsory redundancies.

The firm employs about 3,500 people at its plant in Burnaston, Derbyshire, and another 500 at Deeside.

Toyota said it had discussed the situation with employees but had made no decision about what action to take.

The review, which is part of regular salary review discussions, is due to be completed in March.

Staff at the Burnaston plant have been told one assembly line will shut, and both the Avensis and Auris cars will be made on a single line.

A statement said 2009 had been a "tough year for Toyota Manufacturing UK", but it said the decision was related to efficiency, rather than any cut in the number of cars produced.

It added that talks at the firm were centred on managing the situation in order to ensure sustainable long-term business.

In 2008 the factory produced more than 213,000 vehicles but this fell to 127,390 last year.

This reflected an industry-wide slump of 30.9% in car production in 2009.

Long-term plans

The company has indicated it hopes to raise production in 2010, despite prediction from the Society of Motor Manufacturers the year would still be difficult for manufacturers.

South Derbyshire MP Mark Todd said the news came as a blow, but he was confident about Toyota's commitment to Burnaston.

He said: "This is a very successful, high-quality business.

"In my experience of dealing with them, they will do their utmost to retain the top skills they have got at Burnaston.

"They are not short-term thinkers. They are interested in the longer term."

Voluntary redundancies

Unions have so far not commented on the news.

In 2009, faced with a need for smaller capacity, the Derbyshire factory adopted new working conditions leading to a 10% pay cut and a shorter working week.

A voluntary redundancy scheme was also put in place at the suggestion of employees.

But increased sales, driven by the government's car scrappage scheme, led to the factory reverting to a full-time five-day working week in August and September.

The announcement about the firm's surplus jobs comes as the car giant plans to extend a massive safety recall to Europe because of an accelerator pedal problem.

It has also issued a similar notice in China.

Hyundai has reported a fourfold increase in profits between October and December as government incentives helped to boost car sales.

Net profit for the period was 945.5bn won ($820m; £505m), compared with 243.5bn won a year earlier.

This was considerably higher than analysts had expected.

Hyundai's fortunes are in stark contrast with many carmakers across the world that have struggled to cope with falling sales during the downturn.

It has benefited from the South Korean government's decision last year to introduce a 70% cut in taxes for consumers buying new cars.

Ford has posted an annual profit for the first time in four years.

The carmaker made $2.7bn (£1.7bn) in 2009, compared with a loss of almost $15bn in 2008, and said it expects to be profitable this year as well.

For the final three months of last year, the company made $868m, a dramatic improvement on the $6bn loss it made a year earlier.

Ford said its return to profitability was in part due to cutting costs and reducing debt levels.

Ford employed 89,000 people in the US at the start of 2009, but that number dropped to about 80,000 through buyouts and layoffs by the end of the year.

The importance of cutting costs was highlighted by the fact that revenue for the full year was $118.3bn, $19.8bn less than in 2008.

'Challenges ahead'

The firm is also enjoying goodwill for avoiding bankruptcy, analysts said.

The carmaker's big rivals General Motors and Chrysler, which together with Ford make up the so-called Detroit Three, both took billions of dollars in state aid and went into bankruptcy protection last summer.

"While we still face significant challenges ahead, 2009 was a pivotal year for Ford and the strongest proof yet that our One Ford plan is working and that we are forging a path toward profitable growth," said Ford president and chief executive Alan Mulally.

Dealers fought back from the effects of the recession in November to achieve sharp increases in the volume of new cars sold with the help of point-of-sale finance.

Data from the Finance and Leasing Association shows that 40,734 new cars were bought by retail cust-
omers – an 81% year on year increase – thanks to advances totaling £515 million, an increase of 79%.

The scrappage scheme was a major reason for the improvement.

November 2008 was a low point for the industry as the credit squeeze gripped tighter. But finance companies and their dealers are heartened by the improvement.

In the three months to November 156,542 new retail cars were sold on finance (25% up year-on-year), with advances totaling £2.03 billion (28% higher).

The figures for the 12 months to last November show declines in volume (by 15% to 426,221) and value of advances (by 11% to £5.548 billion).

The used car sector did less well. Advances in November were up 5% to £421 million and volume by 4% to 44,260.

But the three months to November showed declines (advances by 5% to £1.379 billion) and volume
(by 10% to 143,622).

In the year to November advances dropped by 14% to £5.47 billion and volume by 11% to 614,296).

There was no change in the number of new business cars bought in November, or in the three months to it, but the volume for the year to November was 19% lower at 359,826.

There were sharp falls in the volumes of used cars sold to businesses on finance – by 43% to 2,875 in November; by 25% to 10,972 in the months to November; and by 22% to 46,407 in the year to that month.

DATED: 28.01.10

FEED: AM

SAIC Motor, China's largest domestic carmaker, plans to use its manufacturing facility in England to revive the MG brand in Europe.

SAIC gained control of MG Rover's Longbridge, Birmingham, plant in 2007, and has previously purchased the design rights and technology to the Rover 25 and Rover 75.

These designs were used to develop the domestic Chinese Roewe and MG 6 models.

In its effort to use its UK facilities to make inroads into the European Union by the end of 2010, rather than manufacturing the established MG Roadster vehicle, the Shanghai automaker will produce cars based on its own designs, potentially manufacturing kits in China and assembling them in England according to the South China Morning Post.

DATED: 28.01.10

FEED: AM

Spyker is taking on a brand which has seen sales in freefall, down almost 60 per cent in Western Europe from 63,412 units in 2008 to 25,723 last year. December sales in Europe fell even further, down 63 per cent.

GM will receive $74 million in cash for the brand, paid in two installments, and $326 million in preferred shares of Saab, according to an AP report.

Spyker is paying for Saab with a loan of up to 4 billion kronor ($550m) from the European Investment Bank, which is backed by the Swedish government and subject to approval by the European Commission. There is also financing of 150 million-euro loan from investment firm GEM Global Yield Fund.

"Today's announcement is great news for Saab employees, dealers and suppliers, great news for millions of Saab customers and fans worldwide, and great news for GM," said John Smith, GM vice president for corporate planning and alliances.

Saab Spyker Automobiles

As part of the agreement, Spyker intends to form a new company, Saab Spyker Automobiles.

GM said the Swedish government is at present reviewing the transaction and the related request for guarantees of a Saab Automobile loan that has been requested from the European Investment Bank.

All going well, the transaction is expected to close in mid-February. GM said the previously announced wind down activities at Saab will be immediately suspended, pending the close of the transaction.

"Throughout the negotiations, GM has always had the hope to find a solution for Saab that would avoid a wind down of the brand," added Nick Reilly, president, GM Europe.

DATED: 27.01.10

FEED: MT

Manhattan court

The lawsuit was filed by, among others, Elliott Associates, Glenhill Capital Management, Glenview Capital Management and Perry Capital in a Manhattan federal court.

It is alleged that ex-chief executive Wendelin Wiedeking and ex-vice president of finance Holger Haerter "repeatedly misled investors".

In a statement the hedge funds involved said: "The Complaint alleges that the defendants repeatedly misled investors and lied about Porsche SE's positions and intentions with respect to VW in order to take control of VW while preventing the price of VW shares from rising to reflect their intentions.

"The defendants' actions enabled them to hide the extent to which Porsche SE had cornered the market in VW's freely traded shares and simultaneously induced the plaintiff funds to establish short positions on the same shares."

Capital markets law

Porsche denies any wrongdoing saying it "always abided by current capital markets law"

Wiedeking quit Porsche last year with a Euro 50m payoff along with chief financial officer Haerter who received Euro 12.5m. The two were forced out of the company after their gamble to take control of VW backfired.

DATED: 27.01.10

FEED: MT

It was responding to figures from the Office for National Statistics, which showed the UK economy had grown by 0.1 per cent in the last three months of 2009.

The economy had previously contracted for six consecutive quarters - the longest period since quarterly figures were first recorded in 1955.

David Hudson, London Head of Formal Insolvency, Baker Tilly Restructuring and Recovery LLP, said:

"Motor dealers will be more concerned at the end of the scrappage scheme on their franchises than a 0.1 per cent increase in the economic health of our country.

"Only when the capacity gap sufficiently narrows, which we don't expect until the second half of the year, will the majority of the manufacturing base see genuine recovery.

"The stark fact is that many businesses will fight to survive during 2010 and the tiny, 0.1 per cent increase in Britain's economic health will mean nothing to them on a practical level."

He said there was "a long way to go".

DATED: 27.01.10

FEED: MT

The business will trade as Lancaster Land Rover.

Growth
The acquisition by the Colchester-based group, signals the group's plan to grow its representation this year.

"We are delighted to be growing our relationship with Land Rover in a key territory with significant opportunities for growth," said Alun Jones, Jardine's chief executive.

"This acquisition is also firmly in line with our strategy of growing our business during 2010 both through organic growth and further acquisitions".

Trading names
Jardine currently operates 19 brands at 50 locations and trades as Lancaster, Scotthall, Appleyard, Minories, Abridge and Clover Leaf Cars.

DATED: 26.01.10

FEED: MT

Motor industry leaders have attacked banks for hampering the recovery of the sector from recession due to their unwillingness to lend.

Paul Everitt, chief executive of the Society of Motor Industry and Traders, said he had held talks with a number of High Street banks including Royal Bank of Scotland, Barclays, HSBC and Lloyds about their support for manufacturing.

However, with the exception of RBS, which has launched a £1 billion manufacturing fund, the banks were only willing to finance global vehicle manufacturers or international suppliers.

Mr Everitt said: "I think they are making a mistake because they don't understand the strategic shift to our industry and the economy."

Shares in the small Dutch luxury car maker, Spyker, have risen by 29% amid new suggestions it will reach a deal with General Motors (GM) to buy Saab.

Last month GM said it had begun the process of winding down Saab, but would continue to try to look for a buyer.

Victor Muller, Spyker's chief executive has recently said he was "still confident" of signing a deal.

Spyker sold 43 cars in 2008 when it posted a loss of $35m (£21m). Its first offer to GM for Saab was rejected.

Six-year-old Spyker, which sold another 23 cars in the first half of 2009, has yet to make a profit.

Its shares were trading at 2.77 euros on the Euronext Exchange in Amsterdam on Monday.

Negotiations continue

Money for a deal to buy Saab could come from Spyker's largest shareholder, Russia's Conversbank Financial Group, or other shareholders.

It would also be likely to involve a large loan from the European Investment Bank, backed by the government of Sweden.

Spyker spokesman Mike Stainton said on Monday that reports of a deal were "speculation", but that the negotiations were continuing.

GM has begun the process of shutting Saab down, though its 3,400 workers in Sweden have not yet been laid off.

Another bid has come from a group including Formula One boss Bernie Ecclestone and Luxembourg-based private investment company Genii Capital.

Swedish union IF Metall, which has a representative on Saab's board, has criticised GM's decision to start the liquidation process while still continuing to explore a sale.

Fiat has thanked the positive impact of the various government-backed car scrappage schemes across western Europe for a rise in sales last year.

The Italian firm said global sales of its Fiat, Lancia and Alfa Romeo models had risen 5.7% to 1.84 million cars.

It said the scrappage scheme in Germany saw its German sales almost double, while UK sales had risen by 17.7%.

However, parent company Fiat Group made an annual net loss, which it blamed on its taking of a 20% stake in Chrysler.

Although Fiat Group did not pay for this share of the US carmaker last June, it said "the strategic realignment with Chrysler" caused significant restructuring costs and write-downs.

This contributed to an annual loss of 800m euros ($1.1bn; £702m), which compares with a profit of 1.7bn euros in 2008.

'Gradual recovery'

The results for the wider Fiat Group, which saw its annual revenues fall 16% to 50.1bn euros, also include the company's agricultural machinery business, and its trucks and buses unit Iveco.

"After a particularly negative start to the year, the introduction of incentives in several major markets led to a gradual recovery in demand in western Europe," said the company.

Under the various scrappage schemes, owners of old cars are given a subsidy towards their purchase of a new vehicle.