Britain is set for an automotive revolution as the final details of government's £230 million ultra-low carbon car incentive programme were announced today.

From January 2011, motorists will be entitled to a "Plug-In Car Grant" of up to £5,000* when buying an electric, plug-in hybrid or hydrogen fuel cell car that meets safety, reliability, performance and warranty standards set by the Office for Low Emissions Vehicles (OLEV) in consultation with industry.

The Society of Motor Manufacturers and Traders (SMMT) welcomed the announcement from OLEV that detailed how cars will qualify for the incentives and the grant ammount. Also announced were the winners (London, Milton Keynes, North East England) of the Plugged-In Places bid which saw UK cities and regions bid for investment to support the development of infrastructure required to support ultra-low carbon vehicles.

"This incentive scheme signals a significant commitment by government and industry to promote ultra-low carbon vehicles and is great news for motorists. The UK is determined to be a world-leader in developing the field of ultra-low carbon vehicles, sustaining and creating high-skill jobs, attracting inward investment and producing cutting-edge products," said SMMT chief executive, Paul Everitt. "Manufacturers develop and produce new technology where demand exists. This incentive will encourage international investment in the UK as well as helping motorists cut CO2 emissions."

The Plugged-In Places investment will see the installation of over 11,000 charging posts in London, Milton Keynes and North East England. There will be another opportunity, in June 2010, for additional cities and regions to bid for Plugged-In Places funding. Already confirmed as intending to bid are the West Midlands, Cornwall, Sheffield, the Lake District, Greater Manchester, and Northern Ireland.

Since its creation in mid-2009, OLEV has worked with industry to promote the manufacture of, and infrastructure for, ultra-low carbon vehicles. The £230 million Plug-In Car Grant and £30 million Plugged-In Places scheme were initially announced in March 2009 before being formalised in Budget 2009.

* Motorists will be entitled to a 25% discount from the list price of the eligible car, up to the value of £5,000. Offer of the "Plug-In Car Grant" will be subject to notification of technical requirements to, and state aid approval from, the European Commission.

Toyota's president has apologised to the US Congress and American Toyota owners for safety problems that led to deaths and worldwide recalls.

Akio Toyoda said he was "deeply sorry" for any incidents which had occurred as a result of failures with accelerators and brakes on several models.

Mr Toyoda pledged his "full co-operation" with the US investigation.

But, under questioning, he insisted no faults had been discovered with the electronics of any of its vehicles.

He pledged that an independent, outside advisory board would look into the issue.

'Not safe'

Toyota has recalled about 8.5m vehicles worldwide.

Earlier the chairman of the House Oversight and Government Reform Committee, Edolphus Towns, said Toyota and regulators had "failed their customers" on safety.

And Transport Secretary Ray LaHood told the hearing that all vehicles which had been recalled were "not safe".

But he added that Mr Toyoda's scheduled appearance showed that world's biggest car maker was no longer "safety deaf" to complaints

'Personal responsibility'

Under questioning, Mr Toyoda said the company had shared with US authorities all the information it had about unintended acceleration problems.

In remarks which he read to the House, Mr Toyoda admitted that the firm's expansion "may have been too quick".

He was joined by Yoshimi Inaba, president and chief executive of Toyota Motor North America, who answered questions in English.

Mr Toyoda read his opening statement in English, but answered questions in Japanese, through a translator.

Mr Toyoda is the highest-profile figure to appear before the politicians.

He had initially said that he would stay in Japan and not face Congress but changed his mind last week after a formal request from the committee chairman.

The grandson of the company's founder, Mr Toyoda said in pre-prepared remarks that he took a personal responsibility for improving the quality of Toyota cars.

"All the Toyota vehicles bear my name. For me, when the cars are damaged, it is as though I am as well. I, more than anyone, wish for Toyota's cars to be safe, and for our customers to feel safe when they use our vehicles."

And he added: "We pursued growth over the speed at which we were able to develop our people and our organisation and we should be sincerely mindful of that."

Chairman Towns said he was "impressed "that Mr Toyoda had agreed to testify voluntarily.

"It shows your commitment to safety as well," Mr Towns added.

General Motors (GM) is to wind down operations of its Hummer vehicles - after failing to complete a planned takeover by a Chinese firm.

GM did not comment on why the sale to China-based Tengzhong had collapsed. Reports have said Beijing had refused to approve the purchase.

GM agreed to sell the brand last year, as it offloaded famous names it owned and went into bankruptcy protection.

It said it was "disappointed" the deal could not be completed.

"GM will now work closely with Hummer employees, dealers and suppliers to wind down the business in an orderly and responsible manner," said John Smith, vice-president of corporate planning and alliances.

The firm added it would continue to honour Hummer warranties, and provide service support and spare parts to current owners around the world.

Pendragon, the UK's biggest dealer group, has reported pre-tax profits of £1.3 million in 2009 in comparison to a £194 million loss in 2008.

The group reduced its net debt by £41.9 million last year and cash generated from operations rose from £53.6 million in 2008 to £93.3 million in 2009.

The group now operates 276 franchises points.

Trevor Finn, Pendragon chief executive, said: "The group has successfully dealt with the most challenging market conditions experienced since the nineties.

“We acted swiftly to implement significant cost saving and debt reduction actions. During 2009 we concluded a successful refinancing to secure the long term future of the group.

“Consequently, we are now in sound shape and have returned to profitability. While we anticipate our market will remain difficult in 2010, we are well positioned to focus on the profit opportunities that will drive our core business forward."

Pendragon closed 26 franchise points in 2009 and it took headcount reductions to help get the business back into shape and able to return to profit. The closure of the sites and 879 redundancies involved set the group back £10.7 million overall last year.

Stratstone, Pendragon’s premium car sector business, posted operating profits of £18.6m in comparison to a £2.5 million operating loss in 2008.

The group’s volume franchise business, Evans Halshaw, saw an operating profit of £14.2 million in comparison to a £6.1 million loss last year.

Chatfields, Pendragon’s independent truck and van retailer, saw operating profits fall from £3.6 million in 2008 to £1.2 million last year.

Outlook

Finn said: "We expect the used car market to remain stable and aftersales to be resilient. In 2010 we therefore expect our used car margins to remain solid and aftersales to benefit from growth opportunities.

"We concur with the SMMT view that the new car market will remain subdued for the next 12 months. We believe a gradual improvement will then be seen. We have taken actions which give us confidence that we will improve the performance of the Group in 2010 despite the anticipated difficult markets. The Group is now well placed to take advantage of markets when they recover and is currently trading in line with our expectations."

Salisbury-based Foray Motor Group has acquired Hine Motors, a Ford site based in Shaftesbury, Dorset.

The group was created through a management buy-out of a privately-run business, Edwards Ford, in Salisbury and has since expanded to include Dorchester Ford and English Ford – both bought from Pendragon.

Chris Yoxon, Foray group managing director, said: “Foray now operates dedicated Ford outlets in Andover, Salisbury, Taunton, Yeovil, Dorchester, Poole and Shaftesbury as well as a Ford service centre in Chard.

“After taking two dealerships from such a major group as Pendragon I still see it as logical to buy a privately-run outlet in Shaftesbury which has been performing strongly for around 30 years, first under the guidance of its founder Gordon Hine and then by its subsequent owner, Roger Booth, who wanted to retire.”

Foray has now taken on 13 news sales staff across the group.

Foray Group sales manager Tom Croft said some people might view it as brave to expand in terms of both dealerships and sales staff as the scrappage incentive ends but both moves made “sound business sense”.

Croft said: “The Shaftesbury community is very loyal to its local businesses and Hine Motors has a great customer base we are happy to serve.

“Hine is a strong business and we can develop it still more using our group facilities to offer local buyers a wider choice from our new and used stock.

“They will still have contact with the original team, although we will be adding to it. We will also be offering more light commercials than Hine Motors has in the past.”

A company that specialises in providing finance for car dealerships provided a record volume of funding in excess of £25 million last year.

Bridford Financial Solutions recorded its best year to date supplying group and independent dealerships with vehicle finance after securing a range of contracts with Ferrari, Aston Martin and Rolls Royce.

The Yorkshire-based company is the choice of a large number of premiership football stars, several multi-millionaires and a couple of lottery winners.

The £25 million represents a big increase from the previous year as the company continues to grow despite the recession, general spending cuts and a HPI report that smaller car dealers are facing growing problems in sourcing finance.

Owner of Bridford Financial Solutions, Tim Marlow, said: "2009 was a fantastic year for us providing over £25 million of car finance and we have already made excellent progress so far in 2010 and hope to be able to announce some new contracts and initiatives very shortly.

"As an independent financial broker we are able to operate as a dedicated finance and insurance company for dealerships whether they are group dealers or independent.

“Despite reports that smaller dealers are struggling to fund sales as finance companies abandon the market, Bridford is going from strength to strength, offering excellent levels of commissions on rates as low 5.95 per cent APR.

“This, along with us providing bespoke, tailored finance packages and excellent customer service, is why so many dealers choose to work with us.”

DATED: 25.02.10

FEED: AM

The final phase of the Government's scrappage scheme has begun.

Under the final stages of the scrappage scheme manufacturers have been apportioned 55,000 potential order quotas to aid an orderly close down of the scheme by giving manufacturers certainty as to how many potential scrappage orders are available to them.

The quota system will be based on retail market share which will favour manufacturers with the highest volume of total sales, rather than the highest volume of scrappage scheme sales.

Paul Williams, chairman of the RMI said: "The scrappage scheme has been a boost to the motor retail industry and has retained employment in the sector by providing in excess of 300,000 incremental sales.

"With VAT at 17.5% the scheme remains an income stream for the Treasury. Should we slip back into recession, this is perhaps something the Government might give due consideration to."

Lord Mandelson

"This is last orders for the scrappage scheme," said Lord Mandelson, business secretary.

"Industry figures have showed again and again the benefits that the scrappage scheme is continuing to deliver to the automotive sector and beyond.

"It is great news that in January scrappage helped the industry to achieve its biggest output gain since May 1976."

The UK scheme, with up to £400m from Government and matched funding from manufacturers, is intended to provide a short term boost to industry and drive consumer demand during the downturn.

Scrappage exit phase - What you need to know

1. When will the exit phase end? The exit phase will end when the budget for the Government's scrappage scheme runs out or at midnight on Wednesday, 31st March 2010, whichever is the sooner.
2. How will the quota system work? Each participating manufacturer will be given an allocation of remaining potential orders based on consumer demand. This will give manufacturers and consumers certainty as to how many potential scrappage orders are available to them. For information on quota availability at the manufacturer of your car of choice you can contact your local dealer.
3. What brands are included? 37 manufacturers have signed up to take part in the final phase of the Government scrappage scheme: Allied Vehicles, Bentley, BMW, Chevrolet, Chrysler, Citroen, Daihatsu, FIAT, Ford, Honda, Hyundai, Isuzu, Iveco Ltd, Jaguar, Kia, Land Rover, London Taxis International, Mazda, Mercedes Benz, MG Motor, Mitsubishi, Nissan, Perodua, Peugeot, Porsche, Proton, Renault, Renault Trucks UK Ltd, SAAB, SECMA UK, SsangYong, Subaru, Suzuki, Toyota, Vauxhall, Volkswagen and Volvo. The scheme applies to commercial vans (up to 3.5 tonnes) as well as cars.
4. Order taking - In this final stage of the scheme there are strict order limits on manufacturers. There will be a small further allocation towards the end of the scheme for those manufacturers that have proved particularly popular with consumers. Dealer should be keeping a waiting list for these.
5. Will it be extended again? This Government scrappage scheme will not be extended. However a number of manufacturers have already announced they plan to offer good deals to customers which will continue beyond the scrappage scheme

Paul Williams, chairman of the Retail Motor Industry Federation, said: "The scrappage scheme has been a boost to the motor retail industry and has retained employment in the sector by providing in excess of 300,000 incremental sales.

"With VAT at 17.5% the scheme remains an income stream for the Treasury.

"Should we slip back into recession, this is perhaps something the Government might give due consideration to."

DATED: 25.02.10

FEED: AM

Spyker Cars has finalised the deal with General Motors to purchase Saab.

Jan Åke Jonsson, CEO of Saab Automobile said: “Today’s announcement is great for Saab’s customers, dealers, suppliers and employees around the globe."

The transfer of ownership took place at 16:30 on February 23.

Saab and Spyker will operate as sister companies under the umbrella of the Amsterdam Euronext listed parent company Spyker Cars.

“We are delighted - Saab’s future is now secure," said Victor Muller, CEO of Spyker.

“From today we will be concentrating all of our efforts into reviving Saab and transforming it into a sustainable and profitable company with the confidence to be bold.

"We will reinforce the emotional experience between Saab drivers and their cars and we will focus on Saab's historical strengths in the fields of independent thinking, aircraft heritage, ecological performance and motorsport.

“With a well funded business plan in place we are looking forward to working with Saab’s management on the realisation of that plan and bringing exciting new products to our customers. Real Saabs, Saab Saabs”

Saab will go ahead with the introduction of the new 9-5 later this year.

The president of Toyota will face tough questioning from US politicians later over safety problems at the firm.

Akio Toyoda is to be quizzed on events that led to 8.5 million vehicles being recalled worldwide and how his firm responded to the public's concerns.

Mr Toyoda has already released opening remarks which admitted that the firm's expansion "may have been too quick".

Meanwhile, Japan's government is to investigate reports of unintended acceleration of Toyota vehicles.

Transport Minister Seiji Maehara said the government would launch a review of 38 cases in Japan over the past three years.

He said the investigation would focus on Toyota but would also include other carmakers.

"The number of complaints about Toyota cars is not out of proportion to its share of the overall number of vehicles registered," he said.

But given the ongoing issue, we would like to investigate Toyota cars."

Explanation sought

The reputation of Toyota has been severely damaged by a string of major problems across a range of vehicles.

The main issues have been faulty accelerator pedals, accelerator pedals getting stuck in floor mats, and a problem with braking systems on its hybrid models.

The BBC's Adam Brookes in Washington said that the House Energy and Commerce Committee had "not yet accepted that Toyota understands why these cars surged out of control".

"The committee is groping for the rest of the story," he added.

A car parts manufacturing firm has announced it will make 165 posts redundant at its plant in Coventry by the end of the year.

Stadco, which has its main office in Shropshire, said it would consult with staff working at the plant in Holbrook Lane, Coventry.

It said no compulsory redundancies were planned before March.

The BBC understands Stadco intends to move its work and equipment to three sites in the West Midlands and Wales.

The company, which has a metal press works in Castle Bromwich and runs an assembly line in Coventry, said it would make all the Coventry-based staff at risk of losing their jobs aware of any vacancies that came up at its other sites.

It also has a plant in Saarlouis in Germany's Saarland and employs about 150 people at a site in Powys, south Wales. Three hundred staff are employed at its main site in Shrewsbury, Shropshire.

Government scrappage scheme to enter exit phase - manufacturer order allocations set

The final phase of the Government's scrappage scheme begins today (Wednesday 24th February), said Business Secretary Peter Mandelson yesterday, reminding would-be car buyers to take advantage of the scheme before it closes.

Car manufacturers have now been allocated shares of about 50,000 potential further orders based on brand popularity by the Department for Business, to help ensure a smooth closing of the scheme.

Lord Mandelson, Business Secretary said:
"This is last orders for the scrappage scheme. Car owners need to move quickly to avoid disappointment if they want to buy a new car at a discount.

"Industry figures have showed again and again the benefits that the scrappage scheme is continuing to deliver to the automotive sector and beyond. It is great news that in January scrappage helped the industry to achieve its biggest output gain since May 1976."

The UK scheme, with up to £400m from Government and matched funding from manufacturers, is intended to provide a short term boost to industry and drive consumer demand during the downturn. It has also removed older vehicles from the road and encouraged consumers to invest in new, safer, and potentially more environmentally friendly models.

By 14th February, BIS had received 355,305 orders for new vehicles under the scrappage scheme since it was announced in the Budget in April.

Toyota chiefs are to begin testifying on safety issues later when the first of a series of US hearings begins.

The Japanese carmaker has recalled 8.5 million vehicles worldwide over safety concerns, the majority in the US.

James Lentz, head of Toyota in the US, will appear before the House Energy and Commerce Committee in Washington at 1100 local time (1600 GMT).

Toyota president Akio Toyoda is due to face the House Oversight and Government Reform Committee on Wednesday.

Robust sales

Toyota said on Tuesday that its global sales were 15% higher in January - when many of the recalls had already been announced - than they were a year ago.

Domestic sales jumped 45%, while overseas sales rose nearly 9%.

The company has been hit by three main safety problems - faulty accelerator pedals, accelerator pedals getting stuck in floor mats, and a problem with braking systems on its hybrid models.

On Monday, Toyota said it had received subpoenas asking it to produce documents relating to the safety problems and the company's disclosure policies.

The subpoenas were served earlier this month by a federal grand jury in New York and by the US financial watchdog, the Securities and Exchange Commission.

Media focus

Mr Toyoda had initially said that he wished to stay in Japan and planned to send Yoshi Inaba, chief of Toyota's North America operations, to face Congress.

But last week he signalled a change of heart and said he would testify, after the chairman of the House Oversight committee formally called for him to do so.

Mr Toyoda, the grandson of the company's founder, will face tough questioning from the committee. He has been criticised for being too slow to react to the safety issues and for the company offering unclear explanations.

The price of oil has risen to a six-week high as reports of a rescue for debt-laden Greece lifted the euro and helped push the US dollar lower.

A weaker dollar makes oil cheaper for buyers in other currencies. The euro rose 0.3% to $1.3608 in Monday trading.

It had fallen to a nine-month low of $1.3477 on Friday after the US Federal Reserve lifted a key interest rate.

US light crude hit $80.51 a barrel at one point, before falling back to $80.16, up by 35 cents.

In London, Brent crude added 42 cents to settle $78.19.

'Propping up sentiments'

German magazine Der Spiegel reported over the weekend that Germany's finance ministry had come up with a plan that would see countries that use the euro providing aid worth between 20bn and 25bn euros (£17.6bn-£22bn) for Greece.

"The weak dollar is the biggest driver of crude prices this morning and hopes of a financial rescue for Greece are propping up sentiments," said Clarence Chu, a trader with Hudson Capital Energy in Singapore.

Oil analysts said prices were also being lifted by figures showing an increase in oil refining in China, and the continuing strike by Total refinery workers in France.

Fiat is temporarily shutting six Italian factories for a fortnight.

The carmaker said the move was needed because the end of car scrappage schemes in Europe had led to "a collapse in orders".

About half of Fiat's Italian car plant workers, some 30,000 people, will be affected. There were demonstrations over the weekend at Fiat factories.

Earlier this month, Italy's government announced it would not be renewing the country's car scrappage scheme.

The plants concerned, which make cars rather than trucks and farm machinery, are in Rome, Turin, Naples and Sicily. Five of them are owned by Fiat and the sixth is a joint venture with Peugeot.

"Over the past year we have had various plant stoppages, but this is first time that all the plants have been closed at the same time for two weeks," said Fiat UK chairman Richard Gadeselli.

He added: "The car industry in the past used to stockpile new cars, but now we're only building to demand."

The unions have requested a meeting with Fiat's management and the government on the future of Fiat.

Volvo car dealers will be able to offer new and more competitive finance deals after the manufacturer agreed a new partnership with Santander Consumer UK.

Santander will now provide a range of wholesale and retail finance options to both Volvo Car UK and its dealers.

The deal transfers finance provision from Ford Credit to Santander.

Dealers will still offer finance options under the Volvo Car Financial Services brand.

Dealers should also now enjoy reduced stocking costs thanks to the new deal.

“Our new partnership with Santander provides us with great opportunities to support car sales activities through the provision of highly competitive finance products,” said David Browning, Volvo Car UK’s finance manager.

“The provision of a dedicated Santander field force will provide further support to dealers to grow sales in general.”

Volvo’s relationship with Lex to provide business finance such as contract hire to its corporate customers is unaffected by this partnership with Santander.

DATED: 21.02.10

FEED: AM

Citroën has begun its drive to attract plate change buyers with a range of incentives for its small cars.

The C1 is available with a 5.9% finance offer on most models, making the 1.0 68hp VT 5-dr model available for £139 a month.

The new C3 has a similar 5.9% finance offer across the range, making the 1.1 61hp VT available for £175 a month.

The C3 Picasso - AM's 2010 New Car of the Year - sees most models available with 0% finance over three years, with a 30% deposit.

Citroën is also offering its £199 servicing package on all models, which covers all recommended and scheduled servicing, and brake fluid replacement for up to three years/35,000 miles.

DATED: 21.02.10

FEED: AM

Jaguar Land Rover has appointed of Dr. Ralf Speth as its new chief executive officer with overall responsibility for the company's operations.

He will report to Carl-Peter Forster, the recently appointed group chief executive officer of Tata Motors.

Dr. Speth has over 22 years of experience in the European automotive industry and was director production, quality and product planning at Premier Automotive Group of Ford. After that, Dr. Speth has been with the Linde Group where he was the head of global operations reporting to the chairman.

Ravi Kant, vice chairman, Tata Motors, said: "The introduction of Dr. Ralf Speth into Jaguar Land Rover under the guidance of Carl-Peter Forster will considerably strengthen the management of the company and enhance the position and reputation of the two iconic brands in line with the long term strategy of the company

DATED: 21.02.10

FEED: AM

The break up of GMUK Fleet, which had supplied contract hire and fleet lease deals for the GM family of marques, is almost complete after Vauxhall confirmed that from will become Vauxhall Fleet from February 18.

The move follows the restructuring of GM’s European-based operations and sees Vauxhall Fleet return to the centre of the company’s approach to fleet customers.

Saab, whose fleet deals were also offered through GMUK Fleet, is currently in discussion with Spyker Cars while Chevrolet has already ended its association with GMUK Fleet and is now following an independent path that includes a brand-specific fleet sales approach.

Vauxhall and Chevrolet will continue to have shared parentage with General Motors, but the two brands will operate in the UK independently.

The Vauxhall Fleet team will continue to handle all fleet activities and enquiries relating to Saab as it transitions to new ownership, while GMUK will continue to stand behind its obligations with regard to Saab servicing and warranty issues in the UK market.

“Clearly, these are exciting times for Vauxhall,” said fleet sales director, Maurice Howkins.

DATED: 21.02.10

FEED: AM

Halfords has acquired Nationwide Autocentre, the independent car servicing and repair provider.

Nationwide Autocentres - that will be renamed Halfords Autocentres - has 224 centres offering fleets car servicing, MOTs and repairs.

Halfords said the objective in buying Nationwide is to acquire a "high quality company with proven management in a market very close to their current market where they can accelerate growth".

The growth includes opening a further 200 centres, creating 1,000 new jobs.

Halfords said it has no plans to integrate the businesses operationally and it will continue to be managed and located separately from its stores.

Nationwide’s management team will join the enlarged Halfords Group.

"All managers will continue unchanged in their current roles and existing centres will remain open and operating as usual," said Halfords.

David Wild, chief executive of Halfords added: “Our expansion into the adjacent car servicing and repair market is an exciting and logical move for Halfords.

"Car maintenance is a large and highly attractive sector where there is increasing demand from motorists and fleet operators for reliable service at affordable prices."

DATED: 21.02.10

FEED: AM

Your questions posed to our experts - with Stephanie Murdoch, Alliance Consultancy and Training Solutions.

Q. What was the single most important piece of advice you were able to give dealers in 2009?

I think it was to make sure you have documentary evidence to demonstrate your compliance. The FSA is predominantly a desk-based regulator and can call upon evidence of your compliance at any time. If you can’t produce what that they ask for, they will have concerns and will take the view that ‘if it is not written down it didn’t happen’.

The industry is seeing a flood of spurious complaints over the sale of PPI products from ‘legal’ firms taking advantage of the fact that dealers may not have sufficient documentary evidence in their files to prove the sale was compliant.

Although the sales process is only one element of the regulations you need to ensure is 100% compliant, their actions demonstrate how critical it is to have accurate record keeping as its absence can be costly.

Of equal importance is the understanding that you need to keep up to date with the regulations as they are continually evolving. Over the last and during the next 12 months significant changes are happening. With the recent publication of the joint FSA and OFT action plan, the alignment of regulation over the selling of insurance and point of sale finance is getting even closer.

Visiting the FSA’s website atwww.fsa.gov.uk/smallfirms/your_firm_type/motor/index.shtml regularly or using organisations such as ours are the easiest way to achieve this.

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Q. We’re too small to have dedicated business managers, so how can we ensure sales executives consider F&I seriously?

The lack of a business manager should not affect your sales executives’ attitude to F&I. Poor sales are often the result of a lack of understanding and confidence in the sales process and the products. Lack of effective direction and supervision can also be to blame.

These barriers can be overcome. The FSA’s requirements provide a framework which can help you to achieve this.

To ensure these products are taken seriously you need to:

• provide clear direction on your expectations and who is responsible for meeting these
• accurately monitor and measure performance against expectations
• provide staff with the ability and confidence by ensuring they have sufficient product knowledge
• ensure sales execs demonstrate their confidence and understanding before being let loose on customers
• ensure that their performance is monitored and measured
• continuously and any shortfalls are acted upon immediatelybonuses/rewards should recognise both the quality and not just the quantity of sales made.

Collectively embracing these points will give management greater transparency and control and take away any excuses for sales executives not to take the selling of F&I products seriously.

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Q. When are the optimal points to raise the finance question during the sales process?

The key to effective sales is understanding and fulfilling your customers needs. Nearly every customer is a potential finance opportunity. Accurate customer qualification is critical. The habit of pre-qualifying the customer before speaking to them is a BIG mistake and not one that any smart sales person should make.

There are a number of optimal times at which to raise funding:

• In the showroom/on the forecourt. The prominent display of finance deals is incredibly important. Highlighting offers available in the initial meet and greet can plant the seed for follow-up discussion.
• At the time of car appraisal. By this point the customer is pretty warm to the idea of changing their car and is the best time to accurately qualify the customer. Establishing how they paid for their last car opens up a natural dialogue.
• At the point of securing the car sale. By now you should have an understanding of their requirements and the customer should have confidence in you so you can confidently demonstrate how the finance options you have to offer may be more appropriate for them.

Remember customers buy from people they trust. Gain their confidence. Demonstrate your knowledge and skills in your product early in the process This will lead to good sales and finance conversions.

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Q. In these uncertain times what is the safest way to borrow money to buy a new or used car?

One of the safest and easiest ways to get finance is still via a dealer. Acquiring funds through this route provides valuable protection in the finance agreement which are governed by the CCA.

If any problems arise, not only does the consumer have the responsibility of addressing/resolving this with the supplying dealer, but the third party, being the finance house, has an obligation to intervene where necessary, to assist in a satisfactory conclusion.

This type of support and safety net is not available if funds are sourced elsewhere in the guise of an unsecured loan.

There is also no dependency on phone calls or posting documentation. In these uncertain times, being able to deal with someone face to face rather than sharing personal/confidential information via phone/internet is an important consideration for a consumer in protecting against identity fraud.

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Q. What can the Government do to restore financial confidence so people start borrowing money again to, hopefully, buy a new or used car?

It is too early to know whether the Government supported Scrappage Scheme will inject the same level of positive consumer activity and confidence experienced by other EU member states this inititative on its own however will not bring about the level of increase in consumer confidence our industry desperately needs due to the limited audience that can benefit from it.

In the current economic climate many consumers may be being deterred from purchasing cars and entering into financial commitments due to job uncertaintainty. The days of a job for life are well gone! Given the fact that the car is now an integral lifeline for many people rather than a mere luxury item, car financing perhaps should be given the same level of Government protection and support as home mortgages.

Perhaps worthy of debate, to create wider consumer confidence, the Government could consider introducing schemes akin to the Homeowner Support Scheme and the Support for Mortgage Support Scheme. These initiatives provide Government guarantees to lenders against the proportion of any loss incurred on the deferred interest payments in case the borrower defaults.

For consumers it provides them with a valuable safety net to help them in the event of unforeseen job loss/fall in household income which could impact on their ability to make mortgage repayments and helps them remain in their home. These schemes although subject to eligibility criteria provide risk sharing between the Government and lenders and borrowers and provide overall confidence.

In these uncertain times anything that provides potential consumer confidence should not be discounted.

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Q. Several car manufacturers now consider dealer training as a highly lucrative revenue stream! With daily costs per delegate of £500.00 do you share our thoughts that this is becoming an increasing financial burden on the retail network with one example last week of a dealer paying £40,000 in 2008 yet his business lost overall several hundred thousand?

I cannot comment as to whether dealer training is regarded as a profit stream for some/all car manufacturers or on the value to the dealer you raise by way of example in your question. Clearly manufacturers have a vested interest in ensuring that customers who purchase products under their brand receive a consistent and professional service. Whether they would be open, given the current climate, to reducing their charges for the delivery of their mandatory training is something that you would need to raise with your particular manufacturer/s. I am aware that a number of manufacturers are cutting their dealer charges elsewhere so it is worth a go.

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More from Stephanie Murdoch

Stephanie formed Alliance Consultancy and Training Solutions in 2002 to provide expertise on insurance and financial services regulations.

Alliance is a leading provider of consultancy, training and compliance management software solutions to the motor industry.

Our clients include motor manufacturers and manufacturer finance houses, franchised motor retailers, insurance providers and independent finance houses.

The business employs a nationwide network of qualified and experienced consultants and trainers with a strong understanding of how the general insurance market operates within an automotive environment.

The focus of the business is to provide practical help at an affordable cost. Compliance is complicated.

We help businesses to understand it, explain how it affects them, and how to incorporate it into their business so it makes a positive impact.

Alliance is a highly focused company led by its founder Stephanie Murdoch who has over 25 years of experience working in the insurance industry and regulatory frameworks that it operates within.

Stephanie began her insurance career in 1986 working for Jardine Insurance Brokers (now trading as Jardine Lloyd Thompson) which is one of the largest global insurance and reinsurance broking companies in the world.

Originally joining Jardines on a six month contract to help design a software system to support the launch of a pet insurance programme, she went on to develop this specialist niche business into what today is one of the leading pet insurance providers in the UK.

After demonstrating her skills for developing niche businesses and taking products to market Stephanie was made the Sales and Marketing Director for the general insurance and affinity operations across the UK in 1993.

The business provided a range of personal lines insurance products and branded affinity programmes for professional services groups.

Stephanie further expanded this business into providing branded insurance arrangements for major high street retailers, motor manufacturers, utility companies and sports clubs.

This included ground breaking initiatives such as working with Tesco’s to be become the first supermarket to sell insurance products at the point of sale which created the foundations for their highly successful insurance and financial services business.

In 1997 she was promoted to Managing Director of Jardine Group Services and made a main board director of Jardine Lloyd Thompson.

In 2000 Stephanie left Jardines to enter the world of consultancy. She joined Deloittes as a Director to develop a new service line in their specialist insurance division working with new market entrants.

Her role was to work with major brands who wanted to offer insurance and financial services to their customers.

To help in the design, build and management of these insurance and financial services arrangements on their behalf.

Her work also included providing consultancy advice to insurance and financial services institutions who distribute their products through these brand affinity channels.

With this extensive background in insurance and selling products through retail brands and of working within regulatory frameworks when the decision was made by the EU to bring general insurance under regulation Stephanie recognised this as an opportunity to break away from major corporate life and set up her own business.

Her desire was to offer ‘real’ market expertise and skills to businesses at a much more affordable price.

Since 2002 the business has expanded significantly to support the range of services and business growth.

Today Stephanie is a leading speaker on FSA compliance to the motor retail sector and writes for a number of specialist retail publications and brings this expertise to the AM specialist panel.

DATED: 21.02.10

FEED: AM

HPI has introduced its updated CO2 certificate - the only authorised certificate in the industry - in line with the revised car fuel economy label recommended by the Low Carbon Vehicle Partnership (LowCVP).

The labels will enable dealers to inform motorists about the envinromental impact of new cars.

Over 2,000 dealers have signed-up with the Vehicle Certification Agency (VCA) to take part and display the label on cars that they sell since August 2009.

“Our customers recognise and respect the HPI brand," said Ian Beardmore MIMI, group operations support manager at The Co-Operative Motor Group.

"So, this new CO2 certificate is a great initiative.”

The labels were developed with the support from the Retail Motor Industry Federation (RMI), the Society of Motor Manufacturers and Traders (SMMT) and the Government.

The certificates highlight the level of CO2 emissions a vehicle creates, using the industry standard CO2 emissions rating chart – reflecting those already being displayed on new vehicles.

The updated certificates encompass the vehicles estimated fuel cost over 12,000 miles, Vehicle Excise Duty (VED) banding relating to CO2 emissions and MPG figures.

Data is based upon manufacturer new model notification and may vary between vehicles, depending upon options fitted.

Vehicles up to two years old will be covered by the scheme, though dealers can choose to label older cars back to 1 March 2001.