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YOUR MAP FOR THE ROAD AHEAD
■ BREXIT AND AUTOMOTIVE RETAIL IN THE NEXT DECADE ■ THE POSSIBILITIES OF MOBILITY AS A SERVICE ■ ELECTRIFICATION AND AUTOMATION ■ SALES, SERVICE AND REPAIR IN 2030 ■ RESTRUCTURING FRANCHISED DEALERSHIP NETWORKS ■ THE DISRUPTERS AND INNOVATORS ■ THE CONNECTED VEHICLE
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want to ensure that you are aware of AM’s newest development, which we have launched with the aim of giving you and your fellow senior managers easy access to high-level experts and research into the changes looming for our industry. The Automotive Retail Congress will help you shape to your business plans in the next decade. It will include forecast trends in new and used car sales, the aftermarket, national and local government policies, consumer habits, investment priorities, partnership opportunities and new business models. We expect it to provide inspiration and potential solutions to our Irapidly evolving industry. We encourage you and your senior-level MAY 21, 2019 colleagues to attend. If you would like to attend the Automotive Retail Congress, which is on RICOH ARENA, COVENTRY May 21 at the Ricoh Arena, Coventry, visit www.amretailcongress.co.uk for more information and to book online. www.amretailcongress.co.uk Yours sincerely,
AGENDA
Session 1: Used car 2030 The disrupter view Identifying the key Discusses disruption in mobility and The automotive retail trends in the used car subscription services, together with outlook 2021 market and how they the opportunities and threats. Tim Rose will help shape the Ed White, group chairman, White Clarke Editor The UK automotive forecast landscape over the Group, and David Betteley, chairman, AM magazine, AM-online and AM Events Understanding the economic forecast next decade. Tomorrow’s Journey for the automotive sector, including Philip Nothard, customer insight manufacturing and retailing. and strategy director, Manheim The MaaS view Remarketing Emerging companies and established The UK automotive brands are exploring the opportunities outlook after Brexit Aftermarket 2030 that a shift to mobility as a service creates. Tackling the biggest issue How connectivity, new on the business agenda. vehicle technology and The manufacturer view Professor David Bailey, mobility solutions will Understanding the challenges and Professor of Industrial affect aftersales and opportunities faced by vehicle Strategy, Aston customer relationships. manufacturers over the next 10 years Birmingham Business School Dr Andrew Tongue, and how strategies will adapt. research director, ICDP The adapter view Sponsored by Barclays takes to the Session 2: Sponsored by The 2030 Session 3: stage to provide Automotive insight into a new era automotive of banking and how retail market retail business 2030 businesses can adapt. Nick Kerigan, New car 2030 The investment view managing director, future payments in Sponsored by Explores innovations Examining investment cards & payments, Barclaycard that are set to rewrite opportunities, the automotive sector including emerging and – electrification, established disrupters, Conference chairman: connectivity, shared manufacturer R&D and Tony Whitehorn, mobility and how retail groups can former president MAY 21, 2019. RICOH ARENA, COVENTRY autonomous vehicles. remain attractive to shareholders. and chief executive, Cristiano Carlutti, expert associate Mike Allen, head of research, Hyundai UK www.amretailcongress.co.uk partner, McKinsey Zeus Capital Exclusive AM in-DEpTH: FinAnCE & FunDing /
Franchised Dealer Offer PAGES 41-62 n How the FCA motor 20%(hurry - limitedOFF time offer) finance review affects Automotive Retail n your booking with code ‘DEALER20’ dealers DiC changes BROUGHT n TO YOU BY Commission disclosure CONGRESS n Funding pressures automotive management n Building cash reserves www.am-online.com May 2019 £8.00 “ The automotive retail landscape is about to go through the biggest change in its history. If we are to In 2016, 52% of respondents to our Brexit poll said they wanted survive, we need to be prepared. If we are going to capitalise on the opportunity, we need to have a to leave the EU. Now, as we face six more months of uncertainty… good indication as to what the future will look like. This is going to be an important forum to enable us to do just that. This is a key event for all of those who are proactive in our industry and want to be part of the exciting developments ahead of us ” Tony Whitehorn, executive advisor and former president and CEO, Hyundai Motor UK … 60% want to remain
full poll results / impact on vehicle & parts supply / staffing issues / pages 6-13
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EDITOR’S LETTER
hank goodness the March new car market wasn’t abysmal, because there are plenty of other things to feel anxious about at the moment. Are we coming out of the EU or not? Will we get a trade deal or not? Our Brexit insights on pages 6-13 show many of you have already experienced the impact of a Government seemingly unable to govern, and some indeed now regret the vote that led to the current saga. It’ll all get sorted out one day, I keep telling myself. Meanwhile, as we finalised our in-depth dive into Finance And Funding (page 41) and prepare to discuss the future of retailing and T finance at our May 21 Automotive Retail Congress, the International Monetary Fund published a report alerting financial institutions to its concerns over borrowing levels. It sees the risk of global downturn rising as the credit cycle “is maturing”. Meanwhile, looking at the collapse of Debenhams, evolving consumers continue to bite UK businesses that fail to keep pace. The debt-riddled mid-market department store has struggled while lower-cost, lower-end stores such as The Range and B&M have risen rapidly and higher-end brands such as Next and John Lewis have succeeded in omni-channel retailing to survive. Is there a lesson here in deciding firmly which end of the market to trade in?
MEET THE TEAM
Tim Rose Tom Sharpe Stephen Briers Jeremy Bennett Editor News and Editor-in-chief Head of digital/ features editor associate editor
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30 CONTENTS
Batchelors Motor Group
up front insight 06 Brexit: Survey results 30 Face to face: 35 10 minutes with… 38 Brand values: Ian Plummer, 08 Brexit: The impact on Batchelors FCA Group Refining franchise Auto Trader After a torrid 2018, MD vehicles and parts supply partners and an agile The classified giant’s Arnaud Leclerc is counting 10 Brexit: The impact approach to pay models, manufacturer and agency on premium products and on staff and recruitment online sales and business director explains why it customer experience to turn premises have paid off for wants to become a one-stop things around for his 14 News digest MD Tony Denton shop for consumers four-brand NSC 20 Market intelligence # ! ! " 26 Opinion in-depth: finance & funding $ ! ! ! # %" % ! %" ! ! " talent 43 How the 48 DiC schemes 58 Get fit for funding ! $ ! !# # % $! ! FCA review Are agreements linking Cost control and good affects you commission to customer lender relations are vital in ! ! $! " ! interest rates doomed? a declining market 76 Apprenticeship Levy: The findings of the " ! ! " ! Just 7% of dealers Financial Conduct 53 Full disclosure 61 Is cash king? using all of their funds Authority’s review into FCA clarity on commission motor finance have fees is good news, say Dealers are stockpiling 77 People on the move big implications for dealers most industry observers cash and shedding debt $ ! % 78 Eight questions to... Mercedes López, apprentice light showroom vehicle technician, RRG Kia Bury 70 Citroën C5 Aircross 72 Long-term reports
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FP_AM_388006id3730098.pdf 07.12.2018 11:44 NEWS send us your news INSIGHT If you have any news stories you’d like to let us know about email us at [email protected]
Unsure severe 3.1% 4.6% Yes 13.8% moderate 17.5%
Brexit: motor retail no Do you thInk the TAKING 24.4% motor retaIl what DIffIculty have you sought InDustry has have you faceD legal aDvIce on suffereD as a recruItIng staff the possIBle FINANCE result of the as a result of ImplIcatIons BrexIt DecIsIon BrexIt? of BrexIt? TO THE sInce the vote? swings to ‘remain’ mild 16.9% NEXT LEVEL Yes none no 72.6% 61% 86.2% Three out of four respondents in AM’s ‘second referendum’ believe 2016 Brexit decision has damaged the motor retail industry Our dealers have told are you stockpIlIng any of the followIng In the event of a harD BrexIt? us they want a simpler, he political and accurately differentiate the effects of dence of 10% of consumers and economic turmoil Brexit on the retail sector from those that’s 10% of potential car sales put faster finance process. triggered by 2016’s created by negativity and taxation at risk. That would hit the sector funds (either in cash or 46.8% One that helps build T EU referendum vote changes surrounding diesel vehicles extremely hard.” funding agreements) customer relationships. appears to have and the impact of the Worldwide Paul Goodwin, managing director of AM’ So we’ve done it. transformed s Leave-supporting Light harmonised vehicle Test Arbury Group, described the three new vehicles 35.1% majority of Brexit survey respond- Procedure (WLTP). years since the vote as a “disastrous AM’ ents into a win for Remain. Bailey, who will speak at s period in terms of the flow of informa- Used vehicles 20.8% Two new ways to help Three years after car retailers Automotive Retail Congress on May tion reaching businesses and the proved to be an accurate barometer 21, said he was not surprised that general public about Brexit”. you unlock customer tyres 13.6% opportunities: of the public mood, with 52% indi- many car retailers would have voted “For me, the biggest concern is cating they would vote Leave, 54% of in favour of leaving the EU, however. that there has never been a bigger Portfolio3Sixty respondents to the 2019 follow-up He said: “Often (car retailers) are disconnect between Government automotive parts 37.7% survey claimed that they voted to confident people, who feel that they and the people,” he said. Our market-leading consumables (oil, brake remain when they entered the ballot can navigate through choppy waters. 28.6% retention tool box on June 23, 2016. “I’m not surprised that many of legal lows fluid, antifreeze etc.) More significantly, a 59.6% majority them may have voted to leave, but Despite the limited flow of informa- 0% 10% 20% 30% 40% 50% Finance Online of voters in our latest survey said I’m equally not surprised that reality tion, AM’s 2019 survey reflected Our POS system they would choose to stay in the EU seems to have dawned.” retailers’ earlier apparent reluc- provides a more if they were given the chance again. Imperial Cars’ operations director, tance to seek legal advice to assist Of the 40.6% of respondents who Neil Smith, said he did not vote in the their Brexit preparations. said they had sought legal advice. and kept him updated on their skilled workers earning over £30,000 bespoke service to said they voted ‘Leave’, 14.3% referendum, as he felt unable to In 2016, just 5% of respondents Three years on, that figure had risen Brexit plans. is completely arse about face. your customers admitted that they would change decide given the lack of information. to just 13.8%. However, just 42.4% of our survey Currently, 78% of our operatives are their vote given a second chance. However, he added: “The Brexit Goodwin was the only retailer AM respondents said they had received Eastern European. If the flow of Sue Robinson, the director of the situation only has to hit the confi- wouldn’t spoke to who had. He said: “Our assurances from their manufacturer labour stops, then we will have National Franchised Dealers Asso- vote solicitors helped us to alter some of partners about vehicle supply post- serious issues.” ciation (NFDA), insisted that, despite 1.2% the wording on our contracts with Brexit. [See ‘Brexit: The impact on He added: “The idea that these AM’s referendum-mirroring survey customers and suppliers to account vehicles and parts supply’ on Page 8.] people have come here to take our result in 2016, “a majority of NFDA Britain for potential pricing changes in the Retailers have clearly been making jobs is simply a myth.” members, polled before the refer- should leave event of additional post-Brexit taxes preparations, with 46.8% saying they Bowkis said changes to EU endum, voted to remain”. the eU and tariffs.” have stocked up on funds; 35% on employment law will be at the top of She added: “NFDA is not surprised 39.1% Bailey said he was surprised that new cars; 20.8% on used cars; 13.6% Lawgistics’ agenda once the by the swing in sentiment, if there is, retailers had not sought legal on tyres; 37.7% on parts; and 28.6% Government’s exit plan is finalised. in fact, a swing. The potential impact counsel in greater number “given the on consumables in anticipation of While the impact of legalities on of Brexit on the UK automotive amount of time and effort that legal potential import restrictions. the employment of foreign nationals industry and other important sectors companies have put into researching in the automotive sector may not be was downplayed by politicians. WHAT WAY WOULD the impact of various outcomes”. eU workforce exodUs fully felt until after Brexit, there are “Now that the consequences are a However, Nona Bowkis, legal The Brexit vote has had “no impact” suggestions that a shifting dynamic little clearer, it is not surprising that YOU VOTE IF THE EU advisor at Lawgistics, said legal on recruitment, according to 61% of between the UK and EU may already some leavers are reflecting on the REFERENDUM WERE professionals had little advice to respondents, with just 4.6% stating be having an impact. challenge that lies ahead.” offer at the moment. that their business’s staffing had AutoTech Recruit managing HELD TOMORROW? She said: “A lot of the bigger legal been severely affected. [See ‘Brexit: director, Gavin White, said the migra- Bitter Brexit experience firms have issued advice, but that’s The impact on staff’ on Page 10.] tion of skilled technicians from the Discover the next level Almost three quarters (72.6%) of been more to do with supply chains. Many of the worst-affected areas EU had not escalated since the of dealer finance at respondents to AM’s 2019 Brexit poll Very little has filtered down into may be those outsourced to Brexit vote, but had been ongoing for said the automotive retail sector had the key issues which will affect third parties. a decade. blackhorse.co.uk suffered as a result of the Brexit vote. Britain car retail. Martin Peters, sales director at He said: “I think it is an EU-related /nextlevel About a quarter (24.4%) claimed it should stay “For now, it’s a futile exercise. We’ll valeting service provider Autoclenz, issue. As funding has been chan- had not. in the eU be ready to go as soon as we know said: “The truth is that UK residents nelled into countries like Poland, so 59.6% David Bailey, Professor of Indus- what is actually going to happen.” just don’t want to fill the kind of workers have been going back to trial Strategy at Aston Birmingham Goodwin said Arbury’s manufac- labour-intensive jobs that we offer. work in their home nations.” Business School, said it was hard to turer partners had been supportive “Talk that the UK might only accept TOM SHARPE
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Waller said: “Many carmakers Brexit will accelerate that trend. PARTS SUPPLY have bought additional storage He said: “Some brands planned to capacity, but have still run out of get cars into the UK early. It mitigated BREXIT: THE IMPACT ON space and so have been pushing the risk in Q1 and we see that The fact that parts won’t attract deliveries a day that if the some cars through to dealers.” continuing into Q2. tariffs in the event of no deal industry was called on to store He said there is a risk of “significant “If you have no visibility on the will reassure dealers worried more parts, there wouldn’t be overstocking and discounting over future, the best way to mitigate the about costs going up. the capacity to do so.” the coming months”. risk is to get vehicles into the However, any confusion or Nash said it would then have VEHICLES AND PARTS SUPPLY Waller said this extra inventory will UK now.” increased red tape may delay to come down to the manufac- incur significant additional costs for Waller said: “Unlikely though the flow of parts. It’s a system turers to make sure they had both carmakers and dealers: “The no-deal seems, the contingency and that has become extremely parts warehouses big enough impact of the contingency planning scenario planning for a worst-case slick, with Steve Nash, IMI chief to store inventory. on the new vehicle supply chain into Brexit by several carmakers executive and former after- Davis said one dealer client To offset the risk of gridlocked ports and 10% tariffs in the event of ‘no deal’, the UK has been significant, including anticipates a fall in sales similar sales director for BMW Group hedged its bets by instructing ships being held at European ports to that following the 2008 UK, saying that when he was its sites to increase their stock some manufacturers pushed as much stock as possible into the UK in Q1 in March due to lack of unloading financial crisis. working for the German holding of fast-moving service capacity at UK ports, the costs of “While extra inventory has been premium brand, he could get parts to cover at least three rior to the original stock by 20,000, to 54,738 vehicles as past 12 months to get greater keep their retailer partners in the additional carmaker storage and the brought into the UK, carmakers parts from Germany, onto a months’ worth of disruption March 29 Brexit day, AM was going to press, it had volumes of vehicles into the UK in Q1. loop. cost and management pressures remain cautious and, like everyone train and onwards to any should supply issues arise. car manufacturers sufficient storage capacity not to He said manufacturers had filled “Some deliveries are being generated by additional stock else, are hoping that contingency destination in the UK within He said: “We would advocate P filled the UK to the push them out to its dealers. Gefco’s stock facilities to the brim, significantly delayed by this 24 hours. any well resourced group or brim with new stock Mike Jones, ASE chairman, said leaving no space for them to continue stockpiling, which isn’t just Nash said: “Customers and single site do the same, as they to avoid the fallout of a ‘no deal’ exit, the approach to new car supply this tactic into Q2. disappointing customers, but THE CURRENT UNCERTAINTY IS AN dealers are used to having the will eventually work their way with some dealers telling AM that differed depending on the franchise. Thouard said that in the event of a impacting which accounting period convenience of parts availability through the stock no matter brands had pressured them to He said: “Pre-reg over Q1 is no-deal Brexit: “There will likely be sales will be shown in,” he said. OPERATIONAL AND PRODUCTION on a 24-hour turnaround. what happens with Brexit. pre-register as many cars as actually on the same level as last delays as vehicles are either stopped “One client told us the delayed “Dealerships have also “The challenge will be possible. year, there hasn’t been an industry- in port or asked to move to another delivery of cars wiped out £250,000 PLANNING NIGHTMARE FOR moved away from having the whether the manufacturers Fraser Brown, the managing wide boost in that direction. location to be checked if vehicles are profit which would have gone into CARMAKERS, COMPONENT SUPPLIERS AND ability to stockpile large quanti- would be able to meet a wide- director of automotive retail “Every manufacturer and not allowed to stop.” March and Q1. ties of parts. They have got so scale increase in demand for consultancy company MotorVise, dealership is just planning as best Karl Davis, managing director at “These delays will also have a LOGISTICS SERVICE PROVIDERS BEN WALLER, ICDP used to having multiple parts these parts.” said: “I have been told that some they can with the information they Coachworks Consulting, said some negative impact on the motivation of Volkswagen Group brands have have, but it’s moving and morphing of his clients reported chaos at some sales staff as sales targets are being auto-shipped every vehicle in Port of all the time.” ports as the extra vehicles created missed and that is hitting their pay arriving early at dealerships during a plans will remain on the shelf or will Niche products or models already short-term impact on the stability of Tyne, Sheerness, and Grimsby to log-jams that delay dealer deliveries. packets.” peak sales month of March.” have to be absorbed as an expensive pushing the boundaries on price for the production schedule, and this dealers, regardless of their ability to A LOGISTICAL ‘NIGHTMARE’ He said the situation has not been Ben Waller, associate director at A further complication is that insurance policy.” some franchises may no longer may mean delays in supply of new store them. Olivier Thouard, customs and tax helped by a lack of transparency on automotive distribution researchers registrations fell in Q1, with ongoing be viable following a 10% price cars from UK plants – even in the “Other manufacturers offered director at Gefco, a logistics specialist the whereabouts of some ordered ICDP, said the pull forward of vehicles uncertainty over Brexit partly to THE EFFECT OF TARIFFS increase. event of no disruption to supply into huge incentives for dealers to that moves vehicles for Peugeot, vehicles. has affected logistics into and within blame. This means dealers’ ability to In the event of a no-deal Brexit on the the UK in the coming weeks – which register vehicles at the end of March.” Citroën, Ford and Jaguar Land Davis urged all manufacturers and the UK and has put pressure on absorb additional supply is limited. new leave date of October 31, the UK THE EFFECT ON VEHICLE PLANTS dealers may struggle to explain to A Volkswagen Group spokesman Rover, confirmed that it has been national sales companies to prioritise storage space at both centralised Brown said that while some would switch to World Trade According to SMMT estimates, 1,100 customers.” said that while it had increased its UK working with its partners over the the delivery of dealer orders and distribution centres and at dealers. manufacturers are distressing the Organisation rules, resulting in a trucks enter the UK from the EU market through wholesale stock 10.6% tariff on all finished cars and every day to deliver parts worth a LANDING COSTS SMUGGLER’S PARADISE? pushes, others are managing stock trucks. To prevent disruption to total of £35 million to car and engine Brown said manufacturers need to make sure they are being sold supply chains, the UK has set the plants; 5,100 cars and 5,750 engines certainty on what the landed cost of through natural retail demand. tariff on car parts imported from the are exported and 1,300 vehicles are their vehicle is going to be. Under WTO rules and a no-deal suggested that the scheme Dr Holger Hestermeyer, Shell have seen no official announce- He said: “Some manufacturers will EU at zero. distributed to UK dealerships. “Manufacturers will want to get the Brexit, a tariff of 10.6% would be raised the possibility of dealer reader in international dispute ment how precisely this would be looking at the minimum volume Erik Jonnaert, the secretary general Hawes said a ‘no-deal’ Brexit profit bagged for every vehicle as added when a vehicle crosses groups in NI registering and then resolution at King’s College work – and it raises the question necessary to sustain a market and a of ACEA, the European association of risked delays due to border checks, long as there is certainty around that the UK-EU border. shipping pre-reg vehicles to London and currently Mid-career whether this does not imply dealer network viability in 2019. vehicle manufacturers, said profit increased red tape and subsequent landed price.” However, the UK Government mainland UK to avoid the 10.6% Fellow at the British Academy, imposing a border in the Vehicles will move to the most margins in the automotive industry queues at ports. He said that extended negotiations said it would not introduce price hikes. said the politics surrounding Irish Sea.” profitable markets until Brexit are significantly lower than 10%. Several UK car manufacturing “will throw exchange rates into flux checks or controls on goods The fact that a UK industry is Brexit are so toxic, that it is Hestermeyer said there is a settles down. “These extra costs will either be plants had scheduled shutdowns and the potential tariffs will remove moving from the Republic of even talking about the possibility guesswork to think of what very real possibility of goods “Although there is political passed on to the consumer or will around March 29, but now the leave any certainty around a vehicle’s Ireland to Northern Ireland. of what sounds like smuggling policies will be put in place being transported through NI uncertainty in the UK, it should never have to be absorbed by the date has been postponed, shutdowns landed UK price”. There will instead be an highlights the level of confusion at borders. to avoid tariffs and clarity will be discounted as a market. It’s still manufacturers,” he said. may be extended, rescheduled, or at For vehicles leaving on ships that “honesty-box” approach, with all about what is going to happen in Hestermeyer said: “The UK’s be needed. one of the largest and most mature SMMT chief executive Mike Hawes best, rendered unnecessary. take six weeks from leaving the exports to Britain through NI the event of a no-deal Brexit. Department for International He said: “As currently vehicle markets in Europe.” said: “The car tariff could Waller said: “The current factory to arriving at UK ports, there paying the relevant tariffs elec- David Boyd, managing director Trade (DIT) has announced that announced, the NI tariff policy has Ian Plummer, Auto Trader’s result in an average £1,500 uplift to uncertainty is an operational and is no clarity on what that landed price tronically, rather than at border at Roadside Kia in Coleraine, the UK will not check the NI little chance of surviving – or even manufacturer and agency director sticker prices.” production planning nightmare for will be. control in Ireland or in a UK port. said: “We have been given no border – and, indeed, that the UK being implemented as it stands.” [see our interview with Plummer on David Bailey, professor of industrial carmakers, component suppliers While models built in non-EU This puts the onus on the EU for indication that NI would be will not impose tariffs. A WTO spokesman said: “We Page 35], said manufacturers have strategy at Aston Business School, and logistics service providers as markets such as Japan will be less any border infrastructure that treated any differently, so 10% “The position seems to be that have no comment until the situa- already shifted to holding three who will be speaking about the Brexit production requires clear and fixed affected, Asian manufacturers with has to be put in place. tariffs would still be applied to there would be no controls, but tion regarding the UK’s depar- quarters of their stock in the UK saga at AMÕs Automotive Retail scheduling and sequencing of plants in Europe, such as Kia, may Mike Jones, ASE chairman, cars arriving here.” still some form of monitoring. I ture from the EU is clearer.” anyway, with the remainder build-to- Congress on May 21, said model supplied parts. not be able to avoid price rises. order. The potential for a no deal ranges may shrink as a result. “Plant shutdowns often have a TOM SEYMOUR
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NEWS INSIGHT Drive more business
Accelerate your earnings with 40 years’ experience in automotive add-ons. At Car Care Plan, we’ve BREXIT: THE IMPACT ON STAFF got the expertise to take your business from 0 to Automotive employers are being forced to increase salaries to attract workers as Brexit success in seconds. uncertainty and ongoing industry training issues shrink the pool of potential recruits
ncreases in financial director vacancies over the ants (ARC) works with a wider “It’s a commonsense approach.” automotive pay first three months of the year, which cross-section of automotive retail He thinks the outcome of the alongside an Steele said is unusually high. vacancies and director Chris High- Brexit process is less important I increase in the “It’s been said that you hire finan- field said there has not been an than settling the issue: “People just number of vacan- cial directors when you’re in a down- industry-wide pause on recruitment want to know that it’s sorted either cies in the sector suggest that Brexit turn and marketing directors when due to Brexit. way and I think when we get a deci- is having an effect on motor retailers’ things are good, but that’s not the However, he said sentiment did sion and we can move forward, recruitment. reason behind these appointments,” start to change in the run-up to the people will generally start to feel a CV Library’s analysis of the job he said. original March 29 exit date. bit more comfortable.” market in March found that automo- “They have been down to Highfield said: “Initially, there was a However, not everybody is tive industry salaries had increased businesses needing to replace problem when the referendum convinced that uncertainty is the 5.2% year-on-year and vacancies people, rather than groups that are announcement came out. We saw a only thing affecting recruitment. An were up 3.1% in the month, compared struggling financially and need drop in the market, but that started end to freedom of movement will with February. It also recorded a someone to wrestle things back.” to level out over the following months. have an impact on the number of 3.5% increase in new applications to Steele said the 2008 recession “As we’ve got to the back end of people available to take on valeting the automotive industry. forced dealer groups to continue to 2018, that feeling has returned as and facilities management roles. Lee Biggins, founder and chief run lean on staff and that practice we get closer to a leave date.” Ousman Njie, director of Coventry- executive of CV Library, said: “In has never really changed. Combined This has manifested with dealer based independent used car retail response to uncertainty surrounding with the ongoing decline in the groups not looking to replace operation Motonet.com, said his the outcome of Brexit, automotive number of franchised dealerships in someone that leaves. If a team of business was already feeling the employers increased their hiring the UK, that makes drastic head- four can tackle what was previously effects with its vehicle preparation efforts by pushing up salaries and count reductions unlikely in the done by a team of five, they will “really suffering” due to the decision job seekers have been listening.” near future. make do. of a Polish employee to return home Steele Dixon, an automotive Steele said he has been He sympathised with the position ahead of the official departure date. recruitment specialist, said it is encouraged by the fact that some dealers have been put in. Heath Evans, managing director of enjoying its best quarter in its dealers are already building up Highfield said: “If you don’t know Assured Group and chairman of the 58-year history, following a 75% stocks of CVs so they can have what’s going to happen with your Association for Contract Valeting, increase in its business in Q1. candidates ready to go if a vacancy business in the future, you do said there has been a consistent Ed Steele, Steele Dixon managing comes up. become more cautious and investing contraction of labour available for the director, said his company special- He said: “The recruitment market in staff or training is naturally going valeting part of the industry. ises in the senior end of the market, feels very positive right now. As this to come under review. Evans said consistent uncertainty and in that area there has been no Brexit saga goes on and on, I think is reducing the pool of contract staff hesitation for people to move jobs. it becomes less relevant to the available to take on unskilled jobs, The company has worked on nine people at the coalface that are the majority of which he said are getting on with the job.” filled by those from Eastern Automotive Recruitment Consult- European countries. Assured
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COMPREHENSIVE GLOBAL CERAMIC COATING MARKET LEADING TRAINING & CONVERSIONS SEND US YOUR NEWS SUPPORT LEADERS If you have any news stories you’d like to let us know about email us at [email protected] ADVERTISING FEATURE
Group saw its recruitment pool staff to fill the roles available.” drop by 40% last year. Nash said the confusion around the The market’s Evans said: “There is no appetite from Apprenticeship Levy has exacerbated British unskilled workers to take on these the impact of Brexit as dealers struggle jobs, mainly down to the level of pay.” to understand how they can access electric He said there is also a lot of confusion funding to get new blood into the industry. for seasonal staff around whether they Nash, previously aftersales director for By Andrew Brameld, managing director – are allowed to stay in the UK after Brexit BMW Group UK, said he understood how motor finance, BNP Paribas Personal Finance or whether they will get access to immediate the motor retail industry can healthcare. be, particularly when a downturn hits. The market for electric vehicles is Nor are the effect confined to EU citi- He said: “You have some groups like zens. The Porsche Retail Group Sytner that ramp up investment in on the increase, with analysts at managing director Ade Smith said he training and recruitment, but others will Deloitte predicting that, by 2030, was concerned about the impact of be cautious and find themselves in a there will be 21 million electric Brexit on aftersales teams and said one situation where they’re not able to as vehicle sales globally, or about a of his centre managers had decided to easily accelerate when things swing quarter of all new cars sold. return to New Zealand after the refer- back the other way.” But for many consumers, questions endum result. For those dealer groups struggling to The Government has indicated in a recruit or find candidates in the current still exist over the ongoing bills associated with owning one of these modern vehicles – meaning it’s important for dealerships to be able to talk to IF YOU DON’T KNOW WHAT’S GOING their customers about the relevant costs and how TO HAPPEN WITH YOUR BUSINESS IN they will affect the buyer on a monthly basis. THE FUTURE, YOU DO BECOME MORE The good news for dealers and their customers is that it’s usually a win-win situation. While electric CAUTIOUS AND INVESTING IN STAFF OR TRAINING cars typically start at about £300 a month on a IS NATURALLY GOING TO COME UNDER REVIEW PCP finance package – as opposed to less than CHRIS HIGHFIELD, AUTOMOTIVE RECRUITMENT CONSULTANTS £150 a month in some cases for standard petrol or diesel vehicles – the ongoing running costs are substantially less. Home Office White Paper that it will look climate, Nash urged dealers to investi- In fact, some estimates suggest that the cost of to offer lower-skilled and unskilled gate the potential of the Apprenticeship fuelling and servicing the car could be as much migrants from “low-risk countries” the Levy – and not just for technical roles. as four times less than you would expect to find ability to seek work for up to a year in He said: “There are apprenticeships for a typical vehicle. post-Brexit UK. This scheme would run available for finance and management Of course, for dealerships it is important to until 2025. roles. The Government hopes this measure “The job is changing so dramatically emphasise this overall cost when faced with a will help businesses that are reliant on with the onset of electric vehicles. EVs, customer who is looking to purchase an electric immigrant labour to continue trading advanced driver assistance systems and car, rather than the headline PCP repayment after the end of freedom of movement. automated technology is something to figure. Remember it costs less than £10 to fully Those using this route would not be get young people excited about when charge an electric vehicle, substantially less than able to bring family members or access convincing them to join the industry.” a tank of petrol or diesel. benefits. Highfield agreed that the industry Steve Nash, IMI chief executive, said it’s needs to be more forward-thinking It will also change the way retail dealerships all too easy to throw every problem about its recruitment needs. Of the 200 operate and how their profit pools are driven. the motor industry is facing into the or so vacancies ARC is working on, about Longer-term finance plans enabling more Brexit bucket. 30% are for technicians. flexibility for consumers to change will become He said cutting back on recruitment and He said: “The problem you have with a more prevalent and we are continuing to work training is something the industry pause or slowing of training in the industry with our global experience on bringing this has been guilty of during every downturn. is that you can’t get enough people ready However, Nash said there has been a for the future on technical roles. thinking to the UK. noted increase in the number of techni- “We’re seeing a mixture of that and We can help to provide excellent, affordable cians from Eastern Europe either then, from an anecdotal perspective, options for your customer – helping you to returning home or moving to other more immigrants that came over to work in complete the sale now and ensure that you retain prosperous markets as the pound has technical roles are also leaving due to that customer for the long term through innovative weakened. Brexit. Overall, it means there are fewer approaches at the right time. CRYSTAL COAT - THE CERAMIC PAINT PROTECTION KEY TO THE PLATINUM SYSTEM - He said: “If they are working here to candidates and there aren’t enough n OFFERS UNRIVALLED GLOSS RETENTION, SWIRL AND CHEMICAL RESISTANCE. send money back home, it has become people being trained to fill the gap.” For more information, visit www. less viable. Highfield said this cyclical nature of the bnpparibas-pf.co.uk/our-solutions/motor-finance “Those technicians went some way to industry has happened time and time GTECHNIQ’S REVOLUTIONARY DEALERSHIP SYSTEM INTRODUCES DETAILING helping fill that need for technicians in again – there’s political or economic EXPERTISE AND UNBEATABLE PRODUCTS TO THE MIX. the UK, but, regardless of Brexit, we turmoil, business becomes cautious and have always been in a situation where cuts back on training, then you’re left GIVE YOUR CUSTOMERS THE BEST PRODUCTS AND SERVICE, there has not been enough technical with a skills gap. TOM SEYMOUR AND KEEP YOUR PROFIT PER RETAIL UNIT FIGURES SOARING.
am-online.com MAY 2019 13
180828 Platinum advert Automotive Management.indd 1 28/08/2018 11:57:53 FP_AM_180828Platid3599109.pdf 08.28.2018 14:32 NEWS DIGEST
ADVERTISING FEATURE IN DETAIL ADVERTISING FEATURE To view the full story go to THIS MONTH’S NEWS HIGHLIHLIGHTS am-online.co.uk/news BCA builds for The technician the future with MAR VW AND WINTERKORN SUED OVER HENDY ACQUIRES WESTOVER GROUP of the future 15 ALLEGED EMISSIONS FRAUD Hendy Group’s acquisition of Westover Group 29 apprenticeship The US Securities and Exchange should put it into the top 15 of the AM100 Commission is attempting to sue from 29th place last year. Hendy generated By Alistair Horsburgh, CEO, CitNOW and graduate Volkswagen and its former chief £555 million revenue in 2017 against executive Martin Winterkorn (right), Westover’s £336m. Hendy chief executive development claiming that VW issued more than Paul Hendy (pictured) said it would remain Electrification and connected $13bn (£9.8bn) in bonds and asset- “business as usual” as the new businesses vehicle technology, along with the backed securities between April were integrated into the group. autonomous future of vehicles, By Stuart Pearson, COO, BCA UK Remarketing 2014 and May 2015 – a time when, mean the aftermarket will change it alleges, senior executives were APR BCA’s commitment to developing its aware that 500,000 vehicles VWFS AND DROVER LAUNCH MONTHLY SUBSCRIPTION SERVICE dramatically in the coming years, people continues with significant exceeded legal emissions limits. Volkswagen Financial Services and Drover are trialling a 1 and the skills technicians require vehicle subscription service offering access to a vehicle from will evolve. uptake for both apprenticeship and £514 a month. Calculated on a ‘just add fuel’ basis, the price To find out how the role of the technician will graduate development programmes. ENDEAVOUR TAKES OVER HYUNDAI WESTFIELD STORE includes the car, comprehensive insurance, VED road tax, 25 Endeavour Automotive has servicing, maintenance and breakdown cover, with no deposit. change, CitNOW surveyed automotive The programmes have been taken over the operation of professionals, and motoring consumers as part of established to provide the current Hyundai’s Westfield Strat- its ‘The Workshop Professional of the Future’ report. ford City car retail store just TRADE CENTRE GROUP workforce with up-to-date training, to build a future In five years’ time, the majority of technicians 13 months after Motorline REPORTS 44% TURNOVER skills base that meets the future needs of the industry took control of the operation GROWTH IN 2018 believe hybrid and electric vehicle knowledge will from Rockar and Hyundai The Trade Centre Group reported be the most important skills in the workshop, and to attract the best new talent with the potential Motor UK. It will be operated a 44% rise in turnover, to more followed by mechanical knowledge and the ability to become future business leaders. as a satellite facility of its than £253 million, and pre-tax to use electronic diagnostics tools. The top three BCA now offers an expanding list of more than 35 Hyundai North London showroom. profits of £21m in 2018. The results Speaking to AM, Endeavour’s managing director, Adrian Wall- include sales generated by the skills of the past 10 years were seen as mechanical different qualifications covering a wide range of ington (pictured, right, with Endeavour founder John Caney), said group’s new Coventry car knowledge, the ability to work in a team and disciplines, with a ‘Lean improvement practitioner’ that all the existing staff at the store – some of which are original supermarket. Chief executive Andy being a problem solver, so there has been a Rockar recruits from its opening in 2015 – will be retained. Coulthurst (pictured) said: ”We will significant change in skillset. course the most recent addition. continue to make further Three quarters (76%) of technicians believe Apprentice numbers at BCA increased significantly investments in 2019 to improve our 26 HALLIWELL JONES PLANS SITE EXPANSION FOR BMW RECALL efficiency and service levels, electric and hybrid technology will be most during 2018, with a combination of new recruits Halliwell Jones’ Warrington BMW dealership has lodged a including launching an in-house popular on new cars in 10 years’ time and planning application, which, if successful, would allow it to make dealer management system” undertaking qualifications, from Level 2 business workshop expertise in these will be twice as use of derelict land to store 150 vehicles in preparation for the and administration right through to a number of arrival of vehicles subject to the brand’s “safety-critical” recall. important in the next decade, increasing from 18% existing employees studying for qualifications at VOSPERS OPENS FIVE-BRAND EXETER SUPERSITE 2 to 42%. In addition, almost nine out of 10 Vospers opened the doors to its £15 million car retail super site, technicians (89%) said they either ‘strongly agree’ Level 7 – master’s degree. PENDRAGON WINS APPEAL OVER ‘MISLEADING’ USED CAR AD bringing together Ford, Mazda, Alfa Romeo, Jeep and Fiat dealer- 27 or ‘somewhat agree’ that the growing use of The success of the original graduate programme Pendragon successfully appealed its £134,000 conviction for ships in one 45,000 advertising an ex-rental car as having “one previous owner”. In an square-foot develop- technology will be an increasingly important skill. launched just five years ago, has already seen a appeal hearing at Teesside Crown Court, Judge Howard Crowson ment in Exeter. The With this growth in the use of technology in the number of successful candidates rise quickly through found that the ex-business use of the car would have had no effect opening came days workshop, personalised video will play a key part. on its value. after Lookers ‘cut the Technicians will need to rely on video to explain the business into influential leadership roles. ribbon’ at its £10m In 2019, the business launches its new ‘BCA three-storey the unfamiliar terms to the consumer such as Volkswagen show- battery conditioning, battery packs etc. and hone Fast-track Management Programme’ which allows room in Battersea. their presentation skills to be able to offer simple both new graduates and current employees explanations of the more technical elements the opportunity to cover an accelerated cross- FORD UNVEILS NEW PUMA 3 of the car. divisional programme. AND EV KUGA MODELS ■ For more details, please contact us at Ford announced the return of ■ Log on to bca.co.uk or call 0844 875 3480 [email protected], call 01189 977 748, or the Puma and unveiled its new visit www.citnow.com 28 JLR ARCH RESTRUCTURE IS BEHIND SCHEDULE Kuga SUV as it outlined plans to Jaguar Land Rover’s Arch Concept car dealership network introduce a range of electric restructure remains just 60% complete, despite hopes that an vehicles. The all-new Kuga SUV “aggressive” original schedule would deliver changes to almost will be the first Ford to feature every retail site by the end of 2018.AM understands some mild-, full- and plug-in hybrid AM100 groups have deferred work due to Brexit and concerns (PHEV) powertrains alongside over long-term return on investment. traditional engines.
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FP_AM_11304899AUid3810804.pdf 02.06.2019 14:21 FP_AM_11304899AUid3810805.pdf 02.06.2019 14:21 MARKET INTEL Sponsored by
Q1 market review SPONSOR’S COMMENT
By Richard Jones, Mini Dacia 6.61% 52.13% managing director, mild march fall hides big Black Horse I continue my reflections on Seat the four key focus areas in 12.21% the FCA’s report on the shifts in new car market motor finance market by today looking at product information and disclosures. fastest growing The FCA’s concern, following mystery Plummeting Mondeo and Fiesta drag Ford below 10% market share for first time since 1911 Citroën shopping, was around intermediaries, 16.8% major brands* ytd march brokers and dealers not divulging key or a country going through difficul- major success if it is to stop the rot. 7.6% YTD. The rise has come from creditable product features and other regulatory ties/an existential crisis (depending In fact, Ford’s continued market leadership in the increases by models such as the Grandland X (up disclosures, including the existence of on your viewpoint), the March 2019 UK, dating back to 1977, cannot be guaranteed. 64.2%) and Crossland X (up 43.9%), but also F registration figures look quite reas- Volkswagen (8.5% market share) has more than increases that seem to defy logic. Does a rise of commission, early enough in the sales Volvo suring. A fall of 3.4% for the month halved the gap to Ford (9.7% market share). Indeed, 15% in registrations of the Corsa really reflect a 39.01% process to inform customer decisions. and 2.4% YTD looks more like a ripple than a this is the first time Ford has fallen below 10% of new-found enthusiasm among the buying public It is vitally important that customers tsunami. However, it should be remembered that the UK market since it opened its first UK factory for choosing this pensionable supermini over a new receive key regulatory disclosures and March 2018 was a terrible month, with the “Beast – and that was in 1911. Fiesta or Polo? from the East” driving buyers off the forecourts. A The main reason behind VW’s growth is the Behind Vauxhall comes the usual Mercedes/ product features, such as implications Jaguar of mileage, repayment, and vehicle more meaningful comparison is with March 2017, increase in the sales of crossovers and SUVs. The BMW/Audi triumvirate, but the real interest comes -17.32% which was 18.5% higher than March 2019 – that is new C-segment T-Roc has added 4,000 registra- further down the table. Kia (4.3% market share ownership, before agreeing on the a loss of 104,000 sales in two years. tions YTD, while the Tiguan (a bit bigger, but in the YTD) has overtaken Nissan, and is not far behind Audi appropriate finance product for their needs. -12.6% By far the biggest loser has been Ford, whose same segment) has increased sales by 7.6%. VW’s seventh-placed Toyota. That is a remarkable These terms must be explained in clear, registrations are down 17.3% YTD. As discussed crossover onslaught will continue this year with the performance for a brand that was bankrupt in the last month, the biggest fall in unit terms has come B-segment T-Cross, which is just going on sale late 1990s, and whose revival is not much more plain English and be easily understood by from the Fiesta which has lost more than 9,000 (how many VW salespeople, let alone customers, than 10 years old. all customers. As per CONC (Consumer units YTD (-28.5%), but, percentage-wise, the large will manage to remember the T-Cross, T-Roc, However, there is one storm-cloud over Kia, and Credit) legislation, the existence of cars are in the biggest trouble. Ford has pretty well Tiguan, Touareg hierarchy?). To add insult to injury, its parent, Hyundai, in Europe. Transport and Envi- fastest falling commission in particular must be disclosed given up on the Mondeo (down 47.1% to just 1,338 even the big Touareg is having a mini-sales boom, ronment (T&E), an environmental organisation, has Honda before entering into an agreement, with registrations YTD – fewer than the Mazda 6). with registrations quadrupling to 975 units YTD at analysed all the major car companies to see how major brands* -14.62% Meanwhile, the Ford Edge is looking distinctly a time when most big non-premium crossovers they are placed to meet the 2021 target of 95 g/km ytd march the amount also being disclosed if a blunt, with YTD sales down 76.1% to a negligible are struggling. of CO2. They said the two groups in serious danger customer requests. 231 units. The just-announced Puma, a B-segment Behind VW, Vauxhall has had a mini-revival in the of having to pay fines were Fiat Chrysler (FCA) and It is perhaps widely assumed that a crossover due later in the year, needs to be a first quarter, with market share up from 7.4% to Hyundai-Kia. In early April, 2019, FCA said it would customer would know or expect a pay Tesla to pool its sales with FCA’s to meet the commission payment to be made. But we EU target (the EU allows manufacturers to pool segment performance ytd march 2019 sales before the figures are calculated, primarily so must not rely on this. It is incumbent on the intermediaries to be as transparent as that companies in the same group can have a single Nissan 5% calculation – e.g. BMW and Mini). Fiat’s move -15.5% possible about the benefits they receive for suggests that T&E’s calculations are correct, in Ford -17.31% introducing customers to lenders. 0% which case Hyundai-Kia will have to change its Only once a customer understands the full model mix to sell more low-CO2 cars – and a few * Brands with at least 1.0% market share -5% hydrogen-powered halo models are not going to package can they determine if it is the right one for their needs. The ability to monitor, -10% make much of a difference. because a few manufacturers sell enough of Luxury sports models and supercars are doing At a segment level, the market is consolidating them globally to make UK imports worthwhile. reasonably well, but sports cars overall are track and control what information is -15% remorselessly. Despite all the talk 10 years ago The closely related Compact Executive segment down to a record-low market share of just 1.1%. provided to customers is of huge benefit to about how the number of models is proliferating, is faring slightly better, at 4.4% market share, It is no coincidence that two of Ford’s crosso- dealer groups and finance providers alike. -20% just three segments now account for 80.6% of total but is still down by 19.4% YTD. As Jaguar has vers (Kuga and Puma) recycle the names of Customer contact programmes and mystery -25% sales (supermini, lower medium and SUV). That found with the XE, remaining buyers are sports cars (albeit with new spelling in the case compares with 71% seven years ago. Some of the wedded to their traditional Audi/BMW/ of the Cougar/Kuga). Crossovers really are the shopping provide valuable feedback to -30% other six segments look to be near extinction. Mercedes choices. new sports cars. individuals at the front of the customer City cars are down to 7.1% share and the future Of the other segments, Executive (e.g. Meanwhile, large purpose-built MPVs journey, ensuring a collaborative culture of -35% looks difficult. A petrol-engined city car struggles 5-Series) and Luxury (e.g. S-Class) are rela- appear to be on death row. Mercedes has sold continuous improvement. We must all strive to meet the CO2 target of 95g/km on the new WLTP tively stable (luxury is down by 21.3% YTD, but more van-based MPVs than Ford has sold PV m to drive forward standards and further UV cycle, and an electric city car will be an expensive it is close to its long-term average of 0.4% Galaxies and S-Maxes YTD – what is the point ity car uxury ports s c upermini xecutive l s arge s ompact exec e l otal market niche vehicle for at least a few more years. market share). However, affordable sports cars of designing a new MPV when you can get the improve professionalism and customer ower medium c t l Upper medium Upper medium models are already down to just may become affordable sports car – only the same sales from adding windows to a van? service across the industry. 2.1% market share, and the segment only continues Mazda MX-5 appears to have much of a future. DAVID FRANCIS
SUPPORTING DEALERS, WHATEVERTEVER IS AROUND THE CORNER. blackhorse.co.uk/abetterway
20 may 2019 am-online.com am-online.com may 2019 21 adRocket
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‘Additional friction’ March Year-to-date Marque 2019 % market 2018 % market % 2019 % market 2018 % market % ahead puts SMMT’s share share change share share change Ford 40,755 8.90 50,257 10.60 -18.91 67,774 9.67 81,957 11.41 -17.31 -2% estimate for Volkswagen 38,335 8.37 37,843 7.98 1.30 59,519 8.49 57,458 8.00 3.59 full year in doubt 1 Vauxhall 37,769 8.25 37,023 7.81 2.01 54,924 7.83 54,535 7.59 0.71 Mercedes-Benz 33,536 7.32 33,194 7.00 1.03 51,873 7.40 51,173 7.12 1.37 a 3.4% decline in the crucial March plate- BMW 30,330 6.62 31,649 6.68 -4.17 46,753 6.67 47,393 6.60 -1.35 change month’s new car sales has left the Audi 28,132 6.14 29,968 6.32 -6.13 41,876 5.97 47,915 6.67 -12.6 SMMT’s forecast of a 2% market decline by the year’s end looking optimistic. 2 Toyota 20,874 4.56 22,537 4.75 -7.38 31,981 4.56 33,215 4.62 -3.72 as a result of falls in private and business Nissan 19,962 4.36 24,561 5.18 -18.72 29,402 4.19 34,794 4.84 -15.5 registrations, Q1 – traditionally the strongest Kia 18,345 4.00 18,094 3.82 1.39 29,954 4.27 28,751 4.00 4.18 TAKING FINANCE period of the year – has ended down 2.4% year-on-year, a 16,015-unit reduction. Land Rover 16,680 3.64 16,655 3.51 0.15 23,840 3.40 23,815 3.31 0.1 The Society of Motor Manufacturers and Peugeot 16,318 3.56 16,301 3.44 0.1 25,242 3.60 24,643 3.43 2.43 Traders fears there is “additional friction” TO THE NEXT LEVEL ahead, due to continuing political Hyundai 16,317 3.56 18,526 3.91 -11.92 24,777 3.53 28,004 3.90 -11.52 and economic uncertainty. The industry is Renault 13,723 3.00 14,531 3.07 -5.56 19,030 2.71 19,604 2.73 -2.93 still working through WlTP-related supply Škoda 13,637 2.98 13,300 2.81 2.53 21,992 3.14 21,611 3.01 1.76 delays, too. Private registrations were down 2.8% in Mini 12,992 2.84 12,352 2.61 5.18 18,134 2.59 17,009 2.37 6.61 Our dealers have told us they want a simpler, March and 0.8% in Q1, fleet registrations Seat 12,682 2.77 11,829 2.50 7.21 20,635 2.94 18,390 2.56 12.21 rose 0.3% in March, but fell 0.9% in Q1, and faster finance process. One that helps build business registrations slumped 44.8% in Citroën 11,023 2.41 9,050 1.91 21.8 17,136 2.44 14,671 2.04 16.8 customer relationships. So we’ve done it. March and 41.4% in Q1. 3 Volvo 10,420 2.27 8,237 1.74 26.5 16,204 2.31 11,657 1.62 39.01 Honda 10,043 2.19 11,896 2.51 -15.58 15,485 2.21 18,137 2.52 -14.62 Two new ways to help you unlock 1 VaUXHall Mazda 8,791 1.92 10,085 2.13 -12.83 13,058 1.86 14,172 1.97 -7.86 Sales rose 2% (746 units) in March, customer opportunities: thanks to the Corsa (up 13%) and its Fiat 8,325 1.82 8,524 1.80 -2.33 10,956 1.56 11,544 1.61 -5.09 crossovers, Crossland X (up 47%) and Jaguar 8,182 1.79 6,797 1.43 20.38 11,294 1.61 9,709 1.35 16.33 Grandland X (up 43%), which offset a • Portfolio 3Sixty, our market-leading -22% decline in astra sales. Dacia 7,443 1.62 4,013 0.85 85.47 10,926 1.56 7,182 1.00 52.13 Suzuki 6,224 1.36 6,466 1.36 -3.74 11,980 1.71 11,323 1.58 5.8 retention tool Mitsubishi 3,612 0.79 3,929 0.83 -8.07 5,516 0.79 5,997 0.83 -8.02 • Finance Online, our POS system provides 2 ToyoTa Lexus 3,137 0.68 3,006 0.63 4.36 4,406 0.63 4,073 0.57 8.18 a 7.4% drop (1,663 units) in March was MG 1,814 0.40 1,114 0.23 62.84 3,016 0.43 1,775 0.25 69.92 a more bespoke service to your customers mostly due to Rav-4 (-69%) anda uris (-89%) being run out ahead of their Porsche 1,630 0.36 2,659 0.56 -38.7 2,415 0.34 4,074 0.57 -40.72 replacement models arriving in volume. Smart 1,015 0.22 1,201 0.25 -15.49 1,706 0.24 2,067 0.29 -17.46 Discover the next level of dealer finance at Sales of the yaris and C-HR rose 20% and 2% respectively, however. Jeep 986 0.22 1,322 0.28 -25.42 1,547 0.22 1,728 0.24 -10.47 blackhorse.co.uk/nextlevel Abarth 867 0.19 1,107 0.23 -21.68 1,232 0.18 1,527 0.21 -19.32 DS 763 0.17 1,656 0.35 -53.93 1,074 0.15 2,108 0.29 -49.05 3 VolVo Subaru 632 0.14 761 0.16 -16.95 880 0.13 978 0.14 -10.02 Everything but the V40 hatchback Alfa Romeo 615 0.13 1,004 0.21 -38.75 1,023 0.15 1,458 0.20 -29.84 outperformed March 2018 for Volvo, up 26.5% (2,183 units). The XC40 SUV, SsangYong 438 0.10 613 0.13 -28.55 712 0.10 865 0.12 -17.69 launched last spring, has become its Bentley 254 0.06 229 0.05 10.92 429 0.06 410 0.06 4.63 best-seller with 2,577 sales in the month and 4,134 in Q1. Maserati 155 0.03 276 0.06 -43.84 276 0.04 436 0.06 -36.7 McLaren 65 0.01 132 0.03 -50.76 141 0.02 213 0.03 -33.8 Infiniti 45 0.01 160 0.03 -71.88 93 0.01 313 0.04 -70.29 Lotus 26 0.01 36 0.01 -27.78 33 0.00 60 0.01 -45 Alpine 22 0.00 0 0.00 0.00 43 0.01 0 0.00 0.00 Chevrolet 1 0.00 15 0.00 -93.33 3 0.00 17 0.00 -82.35 Other British 428 0.09 335 0.07 27.76 689 0.10 509 0.07 35.36 Other imports 711 0.16 826 0.17 -13.92 1,057 0.15 1,219 0.17 -13.29 Total 458,054 474,069 -3.38 701,036 718,489 -2.43
22 may 2019 am-online.com
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FINaNCE OFFERS Q2 ‘business as Top finance deals for reTail buyers Model Finance Deposit Term Monthly Final APR Offer ends type payment payment usual’ despite Ford Ka+ Zetec 1.2 Ti-VcT 85ps pcp £3,427 24 £99 £6,147 0.00% 30/06/2019 Brexit doubts fiesta Zetec 1.0 100ps 5dr pcp £4,713 36 £178 £6,349 0.00% 30/06/2019 fiesta sT-2 1.5 200ps 3dr pcp £5,035 36 £225 £9,436 2.90% 30/06/2019 T ecosport Zetec 1.0 ecoboost 100ps pcp £4,791 36 £185 £6,899 0.00% 30/06/2019 HE focus Zetec 1.0 125ps pcp £5,378 36 £210 £7,917 0.00% 30/06/2019 NE ealers have pushed through the first c-Max Zetec 1.0 ecoboost 125ps pcp £6,535 36 £239 £6.921 0.00% 30/06/2019 TW quarter and despite the delay to Grand c-Max Zetec 1.0 ecoboost 125ps pcp £7,226 36 £259 £7,100 0.00% 30/06/2019 O D Brexit and a broadly flat Q1 for private RK Kuga sT-line edition 1.5 ecoboost 150ps fWd pcp £5,962 36 £295 £11,293 0.00% 30/06/2019 registrations (down 0.8%), UK IN Mondeo sT-line edition 2.0 ecoblue 150ps pcp £7,001 36 £269 £10,515 0.00% 30/06/2019 G customers are continuing to buy cars. 1 DI One dealer told AM that some customers s-Max sT-line 2.0 ecoblue 190ps pcp £9,545 36 £289 £12,961 0.00% 30/06/2019 9 B NN Galaxy Titanium 2.0 ecoblue 150ps pcp £10,059 36 £289 £11,997 0.00% 30/06/2019 ir E brought their purchases forward to avoid potential t min R O 10% price increases in the event of ‘no deal’. edge sT-line 2.0 ecoblue 238ps aWd pcp £10,449 36 £425 £17,886 0.00% 30/06/2019 h gha F This may account for why private registrations are Tourneo custom Titanium l1 H1 2.0 ecoblue 130ps pcp £10,613 36 £279 £14,261 0% 30/06/2019 J m TH not down as much as they could have been. u E ranger Wildtrak 3.2 Tdci 200ps pcp £12,172.63 36 £299 £12,468 0.00% 30/06/2019 Y According to Mike Jones, ASE chairman, there n EA Volkswagen R have been no sweeping changes with incentives e up beats 1.0 60ps s/s 3dr pcp £3,331.80 36 £115 £4,183 0.00% 30/06/2019 and PCP and PCH deals are what is keeping the Golf Match 1.6 Tdi 115ps manual pcp £4,553.73 47 £225 £7,184.70 2.50% 30/06/2019 2 market in relative health as it continues to get on polo se 1.0 80ps manual pcp £3,871.99 47 £155 £5,937.30 5.20% 30/06/2019 0 with the job despite the lack of clarity on the future 1 of the UK’s relationship with Europe. T-cross se 1.0 Tsi 95ps 5spd manual pcp £4,637.23 47 £169 £7,456.50 5.60% 30/06/2019 9 Jones said: “We’ve only just closed Q1, but all T-roc s 1.6 Tdi 115ps 6spd manual pcp £4,295.17 47 £215 £8,770.50 5.90% 30/06/2019 signs point towards Q2 proceeding as normal. Tiguan Match 2.0 Tdi 150ps 2Wd 6spd manual pcp £6,383.37 47 £265 £10,287.90 5.20% 30/06/2019 “Incentive plans will continue to flex, but Tiguan allspace Match 1.5 Tsi 150ps 2Wd manual pcp £6,651.99 47 £279 £12,140.10 5.20% 30/06/2019 SHARE everything around that right now is business Touareg 3.0 Tdi sel 231 ps 4MoTion 8spd dsG pcp £7,573.70 47 £405 £20,526.30 0.00% 30/06/2019 as usual. Despite the level of uncertainty politi- CONVERSE Golf sV s 1.6 Tdi 115ps manual pcp £4,072.78 47 £259 £5,733.90 2.50% 30/06/2019 cally, the market is actually performing well. CELEBRATE “For the vast majority of people in the UK, a car Golf estate Match 1.6 Tdi 115ps 6spd pcp £4,712.84 47 £235 £7,441.20 2.50% 30/06/2019 is a necessity and the continued success of PCP arteon elegance 2.0 Tdi 150ps scr dsG pcp £8,625.71 47 £315 £13,226.40 3.30% 30/06/2019 NETWORK and PCH automatically bring people back to the passat saloon se business 2.0 Tdi 150ps manual pcp £6,182.61 47 £275 £8,582.40 3.30% 30/06/2019 MEET market and they have to make a decision at the passat estate se business 2.0 Tdi 150ps manual pcp £5,227.71 47 £289 £9,085.50 3.30% 30/06/2019 end of that contract. That is what is keeping the Touran s 1.6 Tdi 115ps 6spd manual pcp £6,317.76 47 £259 £8,190.90 3.30% 30/06/2019 market going.” sharan s 1.4 Tsi 150ps 6spd manual pcp £6,370.40 47 £309 £8,432.10 3% 30/06/2019 While dealers are getting on with the job, they Mercedes-Benz NEW for 2019 have to consider the potential for a no-deal Brexit and what this will do to new car prices and manu- a 180d se pcp £4,399 48 £269 £10,350 5.70% 30/06/2019 facturer’s incentive plan strategies this year. b 180 sport pcp £4,479.83 48 £359 £10,100 6.34% 30/06/2019 The AM Rising Star Award Fraser Brown, managing director of MotorVise, c-class cabriolet 180 aMG line pcp £6,677 48 £409 £15,700 5.70% 30/06/2019 said: “New car price increases in the event of a c-class saloon 180 se pcp £6,299 48 £319 £10,875 5.70% 30/06/2019 Open to dealers, manufacturers and suppliers the AM Rising Star Award no-deal Brexit, with currency fluctuations and c-class estate c 180 se pcp £6,399 48 £329 £11,300 5.70% 30/06/2019 tariffs combined, could take you from £15,000 for c-class coupé 180 aMG line pcp £6,078 48 £399 £13,500 5.70% 30/06/2019 is designed to recognise the strongest individuals in your business, a family car up to north of £20,000. DINNER cla coupé 180 aMG line pcp £4,729 48 £279 £10,275 5.70% 30/06/2019 those who are showing huge potential, developing their career and skills, “In the event of a no-deal Brexit, incentive programmes are likely to soften and then you’ll cla shooting brake 180 aMG line pcp £4,729 48 £289 £10,425 5.70% 30/06/2019 and bringing great benefit to your business. see prices rise three or four times gradually over cls 350 d 4MaTic aMG line coupé pcp £10,949 48 £589 £22,075 5.70% 30/06/2019 19th June 2019 the next six months.” e-class cabriolet e 220 d aMG line pcp £9,512.15 48 £519 £19,300 5.70% 30/06/2019 This is a chance for your company to recognise the best talent in your Ford, the UK’s biggest volume player, is contin- e-class coupé pcp £7,132.32 48 £499 £17,675 6.40% 30/06/2019 business, and give them their time in the spotlight. Winners will receive Hilton Birmingham Metropole uing with its broad support of 0% APR across the e-class saloon e 220 d se pcp £6,571.93 48 £379 £14,150 5.70% 30/06/2019 Pendigo Way, Marston Green, their trophy and recognition from the industry at the AM100 Dinner. majority of its model range, an indication that the e-class estate e 220 d se estate pcp £6,828.27 48 £349 £15,125 5.70% 30/06/2019 strategy on incentives for the biggest player in the Birmingham, B40 1PP G-class G 350 d pcp £14,999 48 £899 £49,500 6.40% 30/06/2019 UK remains largely unchanged. Deadline: Friday 10th May Models such as the Ka and Fiesta are affordable Gla 180 urban edition sport pcp £3,689 48 £249 £11,325 5.70% 30/06/2019 Book your table/ at £99 or £178 a month in Q2. The sportier Fiesta Glc 4MaTic urban edition pcp £7,099 48 £349 £16,625 5.70% 30/06/2019 To request your entry form please contact Emma Bunce at ST-2 is the only model across Ford’s range of repre- Glc coupé Glc 250 4MaTic urban edition pcp £8,399 48 £409 £19,000 5.70% 30/06/2019 [email protected] tickets now at sentative examples that has an APR above 0%. Gle coupé Gle 350 d 4MaTic aMG line night edition pcp £9,999 48 £659 £25,075 5.70% 30/06/2019 www.am100dinner.co.uk Andy Barratt, Ford of Britain managing director, Gle 350 d 4MaTic aMG line night edition pcp £9,703.67 48 £559 £22,100 5.60% 30/06/2019 said: “New models like the Fiesta and Focus Gls 350 d aMG line pcp £9,999 48 £799 £28,650 5.70% 30/06/2019 or contact Emma Bunce on 01733 395133 Active are gaining strong traction with our s-class saloon s 350 d aMG line pcp £12,499 48 £629 £22,475 0.00% 30/06/2019 After dinner speaker confirmed as Jo Johnson MP or email [email protected] customers. s class coupé s 560 aMG line coupe pcp £15,052.01 48 £1,189 £33,050 6.40% 30/06/2019 “Despite the economic uncertainty in large part caused by Brexit, we continue to expect a strong sl 400 aMG line pcp £10,952.22 48 £755 £23,525 6.40% 30/06/2019 Headline sponsors: Associate sponsors: sales year for Ford in the UK.”TOM SEYMOUR slc 180 aMG line pcp £6,674.78 48 £379 £12,150 6.40% 30/06/2019
24 may 2019 am-online.com HAVE yOur SAy OPINIONS do you agree with these opinions? READER OFFER get in touch by email - [email protected] Order online now from VIEWPOINT POLL am-online.com/ SymcoBook AN (EM)PATHETIC IS IT rIgHT fOr THE fINANCIAL CONduCT AfTErSALES AuTHOrITy TO EXPECT dEALErS TO EXPErIENCE dISCLOSE fINANCE COMMISSION? professor jIm saker is director of the centre for Automotive management at Loughborough University’s Business school and an Am Awards judge. he has been involved in the exclusive automotive industry for more than 20 years discount This is a story about customers greatly appreciate the empathy – the “ability chance to see the underside of to share someone their car and have their wheels else’s feelings or counted. But I had more imme- NO yES experiences by imagining what diate questions: Why is one tyre 54.2% 45.8% more worn than the other three? offer for it would be like to be in that person’s situation”. Is it the way I was driving? Is there Recently, my car was due for a a problem with the balance or service and, as my local dealer alignment? Is there a problem lacks an online booking system, I with the suspension? Am I safe? decided to ring. The video informed me that the am dealer I didn’t get through to the retailer, rest of the underside of the car but was instead redirected to the was fine, but they had had to put central call centre, where I gave oil in the engine. Previously, I had my details. They said they would assumed this was what happened book me in on the agreed day for at a service. Maybe I need to lower readers “a service and MOT”. I thanked my expectations. them for their efficiency, but Two hours later, I got a chirpy call The industry appears split on whether the FCA is right to pointed out that the MOT was not from aftersales reception, who require dealers selling consumer credit to tell a customer Give your sales teams the edge due for another year. said that despite problems with they are earning commission from the finance house. I was then told I could drop my car their power washer the previous Our poll shows a small majority of voters think it is unjust. by ordering Words That Sell Cars, off on the day, but not until 8am, day, my car had been cleaned and “Tesco is not expected to tell you how much they make on a the new book by Symco Training’s when the aftersales department was ready for collection. can of beans – how is this different?” said one. Another opened. Even for a university I dutifully turned up to find that stated: “How many other businesses declare their profits? Simon Bowkett, at half-price employee, this is a little late in the my car had not been cleaned. One Another trend of the out-of-touch FCA demonising profit.” day, but I turned up promptly and of the staff disappeared to find it, One added: “As margins get tighter, dealers rely on the became the head of a queue of four returning the dirty-but-serviced commission to afford to get the deal done. Making the imon Bowkett, the £14.99 on Amazon, Bowkett shares this is a journey. you’ll always be people standing in the freezing cold. vehicle at a speed reminiscent of a commission transparent will mean dealers will be pushed managing director his years of experience and advice Eventually, the staff, who could Scandinavian car rally. hard. Inevitably, this will mean only the strong will survive.” of Symco Training, that will benefit staff on the learning as you go along. i find be seen inside, opened the doors At this point, I was given a card Another concluded: “Where does this all end? It’s too much S has agreed to make showroom floor and improve the and invited us to sit down while saying I could book the car in for a interference in what should be natural economics and his new book, Words effectiveness of the whole sales selling can be the lowest-paid easy they got on with switching on free ‘service wash’. As a fellow competition.” That Sell Cars, available at a special team in this online-driven era. work or the highest-paid hard work. computers and getting them- customer in the queue observed, Voters who back the FCA’s commission rules said price to AM readers*. “Even now, with new technology selves coffee. The car was booked this was not much of an offer as disclosure “takes away the mystery” and “will help to self- In the book, which normally costs and the internet, people still want simon bowkett, managing director, symco training in and I left the dealership. you had to book in advance, bring regulate the market and prevent poor customer outcomes”. and need to speak to people. In this Half-way through the morning, I the car, wait around and hope their Some said the industry’s business model is to blame. One book, we look at the process for the delivering, developing and innovating to objection handling and follow-ups. got an unexpected email containing pressure washer was working. stated: “If dealers weren’t under so much pressure to modern world and we talk about the sales training for the real world since Bowkett said: “This is a journey. a video clip pointing out to me that I am anticipating a text from the discount vehicles (which begins by manufacturers placing word tracks that you can use to 2000. With keen observation of the You’ll always be learning as you go my car had four tyres and four dealership in the next couple of inflated list prices on vehicles) they wouldn’t be so pressur- deal with the whole sales process,” theories of human behaviour, and along. I find selling can be the brakes and that one of the tyres days asking me whether I feel I ised to inflate their earnings from finance. The worst aspect said Bowkett. real-world experience, he is lowest-paid easy work or the had been classed as ‘amber’ while received a ‘10-out-of-10’ service. of acquiring a vehicle for many people is being put under Symco Training is subsidising the confident he knows what is needed highest-paid hard work. the others were ‘green’. I under- It shouldn’t take much empathy pressure once in front of the ‘business manager’ in the deal- cost of the book, meaning that AM to successfully manage and motivate “Be a student of sales. Study stand the thinking behind this to understand this customer’s ership, whether by inducement or time-limited promotions.” readers can pick up their own a dealership’s sales team. people and work out what makes approach, and I am sure some response. n Read AM’s in-depth look at Finance and Funding on Page 41 paperback copy of Words That Sell The book is in two sections. Part people tick. Some of the best Cars for just the £7.45 price of one, entitled ‘It’s All In The Mind’, salespeople I know are people postage and packaging. This offer examines the mindsets of both the watchers. Remember – you’re not in “I am sure some customers NEXT MONTH: Are cArmAkers’ ‘stores’ in shopping is limited to one copy per dealership. sales executive and the customer, the motor car business, you’re in the Bowkett is an experienced and how sales people can people business.” greatly apprecIate the chance centres A fAd or here to stAy? automotive industry sales trainer, successfully build rapport. *Terms & Conditions: Offer applies to UK and has presented at a number of Part two focuses on ‘The Road To franchised dealers only. Offer limited to one to… have theIr wheels counted” VOTE NOW AT AM-ONLINE.COM/POLLS AM’s events. As managing director of A Sale’, and contains numerous copy per dealership. Orders must be placed via Symco Training, he has been pieces of advice, from the test drive Symco’s website. Offer closes on July 1, 2019.
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f A ce to f A ce: BA tcH e L o RS M otoR GR o UP The ‘a la carTe’ dealer Narrowing franchise partners and taking an agile approach to pay models, online sales and business premises have paid off, MD Tony Denton tellsTom Seymour
hether you agree with it or iture on the flight training. I’d moved from franchises – Mitsubishi and Suzuki. not, the ‘gin palace’ approach single engine to twin engine and I was five In 2016, the business moved banks from to franchised dealerships – hours away from a commercial test,” HSBC to Lloyds and this triggered Denton’s W big, glass-clad premises said Denton. current business plan to invest in IT, move near an arterial road – is Then Batchelor asked him if he would dealer management systems from CDK to well established, but who has thought of consider buying the business. Pinewood and then, in 2017, to pursue opening dealerships in an Indian restaurant Denton said: “I took a long, hard look at opportunities to expand with the two and a protein shake warehouse? myself. I do like a challenge and learning Japanese brands. The answer is Tony Denton, Batchelor to fly had become more about the He said: “We don’t do anything by halves. Group’s owner and managing director, who challenge rather than the prospect of it If you’re going to have disruption, just have continues the food-related theme by saying becoming a long-term career for me. it all in one go.” he believes in treating the franchised “I didn’t think the opportunity to own a Within 2016/17, Batchelors also business like an à la carte menu. franchised group was something that refurbished its Suzuki Ripon site at the “If the franchise asks us to do something, would pass my way. I took the chance with same time as switching to a new DMS, new we’ll do it, but if it’s not right we’ll talk to both hands and as soon as I let my pilot website and looking to acquire them about a solution to make it better for training lapse, that sealed my decision.” York locations. all parties,” he said. It took about 18 months to create a In 2018, Denton found himself on the “Providing you accept that with management buyout team, and he bought other side of the termination process, as he franchising, then achieving the targets and out his partners to take control of the was acquiring the Suzuki franchise in York selling the cars becomes attainable.” business in 2014. from a group who was exiting. David Batchelor founded Batchelors in It added York Mitsubishi in February of Ripon in 1988, with the help of DOWn TO earTH this year too. Vauxhall’s dealer development programme. Once he took on the business, Denton had The group also has its own used car Eight years later, he had repaid Vauxhall to make some tough decisions. Batchelors specialist site in Ripon, called Signature and was “rowing his own boat”. had grown with multiple franchises and Motors, where Batchelors retails vehicles At about the same time, he added a Suzuki was faced with upgrading its Pickering site that do not fit with the franchised side of franchise in Ripon to the side of an already to continue with Škoda. the business. established bodyshop. In 2000, he added a It was also facing challenges with its multi-franchise business, Chapmans of single-site Vauxhall franchise and Denton THe ‘Suzuki VinDaLOO’ Pickering, which had Škoda, Fiat, Isuzu, needed to get the business back in the When looking at York as a potential terri- Subaru and Proton outlets. This rapidly black after a £285,000 loss in 2013. tory for expansion, Denton found IF THE FRANCHISE expanded Batchelors’ franchise partners, He decided to close the group’s franchises that were on the table, but there taking the total to eight when it added Chapmans of Pickering multi-franchise was nowhere to put them. ASKS US TO DO Mitsubishi in 2010. site in 2014 and a year later he terminated Planning permission is tricky in any city, Denton joined Batchelors a year later, the Vauxhall franchise. but York’s cultural heritage made it SOMETHING, WE’LL having worked in motor retail in various “The catalyst for change was being particularly difficult. When building on land positions at different groups in the area. terminated by Škoda at the Chapmans site. for a new dealership was ruled out, the DO IT, BUT IF IT’S NOT RIGHT However, he was faced with a decision at It was a very successful business and group needed an opportunity that was pre- that point on whether to continue in the we had 9% market share in the area with existing and fairly quick to convert. WE’LL TALK TO THEM ABOUT automotive industry at all. the brand. Denton said: “We knew the opportunity “But we were under some pressure to was coming in York. But we had to find a A SOLUTION TO MAKE IT Learning (nOT) TO fLy improve facilities. The scope in Pickering property. Within York, there are two or He had finished all of the theory aspects of was limited and, at the same point, there three places you can go. We had to really BETTER FOR ALL PARTIES the airline transport pilot licence examina- came another interested party out of town think outside the box for the sort of proper- tions and, after five years, had completed and I think Škoda thought, wrongly, that ties we could acquire. TONY DENTON, 90% of the flight hours needed to become their proposition was better than ours.” “Which is why we’ve ended up in a former fully qualified. This period of cutting businesses reduced Indian restaurant.” BATCHELORS MOTOR GROUP “I was looking at the next bout of expend- Batchelors’ representation to just two The building that houses Suzuki
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A family business: Tony Denton, York was previously known as the The people aT car sales this year to 1,000 units as a result centre, with sons Antony, Bengal Brasserie. The office of Tony of the York business. Its used car sales are left, and Alex, right Denton’s son, Antony, the group marketing The Top also expected to almost double, to manager and sales manager for Suzuki 1,400 units. York, sits where the gas hobs would once undersTand The group is at 100% “would recom- have been turning out chicken ThaT iT’s Their mend” on JudgeService and 95% for tikka masalas. overall satisfaction. Tony Denton said it took Suzuki just 10 franchise, buT, minutes to agree to the idea. building brand relaTionships “That is the beauty of that franchise. They ulTimaTely, iT’s Denton counts himself lucky that he has worked with us and had the blue sky our business been able to build on the relationships the thinking to know it could work,” he said. group has with its existing franchise “Suzuki as a business is very conscious Tony denTon, partners Suzuki and Mitsubishi. of dealer profitability and opening things baTchelors moTor group Batchelors is a strong performer for its that are going to work. franchises, hitting its targets for Mitsubishi “Their view was it was a good location at and hitting 200% of target for Suzuki. the side of the ring road, there was a petrol Denton said working with the two brands station at the back, it’s at the side of York’s He said although the group’s return on has allowed the group to get back on target busiest fish and chip shop and we are sale is lower than he would like, at under without onerous demands that would have surrounded by other dealerships. 1%, he is proud of the turnaround. stunted growth. “With the right marketing and the right “I think the swing on that, all the changes “The people at the top understand that people running it, we had a recipe for a and the profitability is a real success,” it’s their franchise, but, ultimately, it’s our Suzuki vindaloo.” said Denton. business,” he said. Batchelors had to think outside the box He estimated that group turnover would “I know that I could ring any of the senior for its Mitsubishi site in York too, with the be £36 million this year, with a group profit directors right now and they would answer business converting a former 9,000 square before tax (PBT) of about £220,000. In 2018, the phone.” foot protein shake warehouse into a new Batchelors reported its revenues were He said Suzuki and Mitsubishi “get the dealership. Again, Denton said, Mitsubishi £17m, with £105,000 PBT. balance right, particularly around family”. supported the idea very quickly. The group is expecting to double its new Batchelors retains its position as a The changes he has made have put the family business. Denton and his wife, group back into profit and it has been in the Karen, are both directors and black for the past six years. shareholders and he joked that neither of his sons – Antony and Alex, trade sales and group buyer – even asked if they could join SELLING ONLINE the business, they just made the assumption. Antony, laughing, said: “Yeah, pretty other franchises. However, he added: To make sure it can facilitate customers who much.” Batchelors’ York Mitsubishi “Having three franchises without adding want to buy online, batchelors created Before Tony Denton acquired the showroom is situated in a former another tier of management internally protein shake warehouse its own sales platform with its business, he said, it had been offered to a would be challenging. I’m not saying we harrogate-based web lot of other groups. But he is adamant that have closed the door on representing other developer. getting swallowed up by a larger dealer brands, but my desire would be to expand denton said his millennial group and disappearing into the sunset is with existing brands.” sons are quick to pick holes in not on his agenda. Denton said this is because the group the group’s online strategy. He said he plans for his sons to eventu- already knows the people, the products and “i saw it as a definite need. ally take over the running of the business. the systems, and, more importantly, the people like transacting online,” he said. online, choosing add-ons and Both have been around the motor trade brands know how Batchelors operates. “There are a number of local businesses, not accessories and then paying in since they were young and both took on just motor businesses, that have got absolutely full online. part-time work at the age of 14, valeting ‘TLC noT PLC’ appalling websites and i’m worried for them.” The majority of batchelors’ online cars and working their way up in the trade. Denton has a 35-minute drive between There have been tweaks along the way. denton sales have been finance business on used For now, Denton’s aspirations are to add Ripon and York and acknowledges that his found that when it came time for people to pay cars, rather than new. it has the facility to sell another location, grow with existing fran- first time running a multi-site business online, some were bailing out. This led to adding new cars online directly, but it’s almost always chises and transition into a chairman role ”has been a learning curve”, with the little the option to finish payment at the dealership. older used models. when the time is right for his sons to run fires he used to put out becoming more if a customer values a part-exchange online, antony said: “We’ve generally found that the group “in their mid- to late 20s”. If the difficult as his time is split between the batchelor’s website can retain that information online is a mix of the sales process. another group wanted to expand further to six or two locations. and recalculate pricing depending on which customer reserved online, test drove the car seven sites, that would be down to Antony However, he said he has been able to vehicle they are looking at. and went away and then bought online through and Alex, he said. meet this challenge by surrounding antony denton said batchelors has had our website. himself with a team that have an eye for customers walk in, browse stock and then refuse “it was really important for us to give the The neXT sTep detail and understand Batchelors’ motto of to leave details other than a name. but then it customer the option to deal with us how Batchelors’ next goal is to increase being ‘TLC, not PLC’. will see that person valuing their part-exchange they like.” turnover to £50m, and Denton said the He said: “It has to be a great group is currently being courted by a few experience every time a customer
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Batchelors’ York Suzuki site is housed in a former Indian restaurant MINUTES touches the business, whether that’s live chat, on the phone, email or on-site.” The company adopted the motto in 2012. Batchelors was feeling the pressure of competition from other 10 WITH... Vauxhall dealers surrounding it and felt it needed a point of differentiation to help customers understand why they should consider a single-site operator in Ripon. Ian Plummer, mmanufactureranufacturer andand Denton said: “‘TLC not PLC’ was a marketing campaign that we’ve just never dropped. agency director, Auto Trader “Over the last few interviews when recruiting for York, they have said the motto to us and they know that’s what we’re about.” Both brands share a workshop at Mitsubishi York Antony Denton said that the fact What are the other marketplaces that GOOGLE exchange valuation. We make a virtuous you believe offer motor retailers the cycle which should deliver value to the HOW BATCHELORS CHANGED most to learn from? ESTIMATES 60% consumer, then the other things will Booking.com, Skyscanner, Rightmove, OF CAR BUYERS follow. ITS SALARY SCHEME Zoopla – they are about big-ticket items too. Think about what big-ticket DON’T VISIT THE BRAND Are online sales a growth opportunity consumers spend a lot of money on – for the industry? Batchelors was number one is their home, number two WEBSITE, THEY’RE Anything which delivers a consumer struggling to their car and number three is usually a PROBABLY GOING TO experience that is better and more recruit at its Ripon big holiday. In two of those three diverse than we have given traditionally is base, so it decided industries, you have very effective MARKETPLACES LIKE OURS a good thing. So long as the industry to increase the basic marketplaces. In cars, that marketplace believes – and I don’t think many do by salary for sales doesn’t really exist in the way it ought to IAN PLUMMER, AUTO TRADER now – that there’s only one consumer executives from – to help consumers find their next new journey, ending in traditionally interacting £13,500 to car in the same easy way as those other with the retailer and doing the paperwork £17,000. marketplaces. What those places do is marketplaces like ourselves or to inde- in the dealership, that is likely to put off a The old payment what we try to take inspiration from. pendent publishers who allow them to number of buyers. Anything that makes plan focused on Batchelors is family-owned has become “normal” businesses that take stock with It’s the notion of ease of search, of compare different makes and models the process more transparent, more vehicle units, but the a recruitment attraction for those who year-on-year performance, Denton transparency, of speed and simplicity of and, more importantly, to move from seamless, and unlocks different journeys new plan was more focused on the sale have worked elsewhere in the industry believes the motor trade is fixated on search, these are all things we aim to one to another. Once they recognise this, for different people, will unlock much of additional products, such as service and don’t like the way PLCs operate. month-to-month progress, picking the deliver. They are things those market- they do recognise the power of those more and new opportunities to deliver plans, GAP insurance, finance, paint Tony Denton has worked for PLCs business apart every 30 days. places are already very good at. marketplaces to provide a coherent, cars to people in new ways. protection and extended warranties. and said his old business partners “Sometimes you just need to let the consistent journey similar to what they Different finance products will unlock The new scheme was devised as part describe the feeling of being in such a cement dry,” he said. Do manufacturers now accept that show on the brand site. new opportunities for some people to of Antony Denton’s Suzuki manager business as: “A box, a bread bun, a “We are governed by outside consumers won’t go to each individual Some are keen to bring the consumer engage with cars. Give someone a monthly accreditation programme. It wanted him burger, a gherkin, a slice of cheese and companies that provide us with informa- brand’s website to find their car, and from that marketplace back to the brand subscription to a car, for example. to do a case study and he chose to look a toy. Next. tion all the time, all telling us what is hot that they will use sites like AutoTrader website. Some are conscious a at remuneration. “Even if someone in the kitchen says to and what’s not. to shop in one place? consumer will come to a marketplace to So will short-term subscription models The team was initially receptive, but change the recipe, you can’t change it. “There’s so much data available and the Clearly some brands engage with that find a new car and happily stay there, become a feature of the market in became more nervous that they had to Our philosophy is that if something’s not motor trade as a business has become journey more than others. All are rela- and are working with us to provide all future? work a little bit harder beyond the sale working, we can change it.” overly complicated over the years. tively realistic to the fact that customers the tools to allow the consumer to find It will allow us to give more varied of the vehicle to earn the bigger money. However, Denton said smaller Fundamentally, we fix cars and we sell needing a hotel use websites such as out everything they need about that car solutions to a consumer base. The trio of Where Denton believes Batchelors’ businesses can also have issues and one cars. You’ve got to stick to that and not let Booking.com, and then may go to the and then engage with the retailer in an fundamental aspects of a car usership approach differed to that of a PLC was thing non-PLCs can be guilty of is it become overcomplicated.” relevant website of the individual hotels easy way. experience that people are looking for is that it continued to run both pay plans at changing things too quickly. for more information and even to The success of Auto Trader is built on value, convenience and flexibility. It the same time over a quarter. The sales The motor trade loves a key perfor- transact. In the same way, I think they do a powerful consumer experience. That depends on which of that trio each executive could then choose which one mance indicator (KPI) and tracks FACTFILE recognise that the car buyer needs to do brings consumers to us. They also come individual ranks most highly. paid them the most. progress across all departments. the same thing. The car industry has because the stock is here, and the stock Our parents’ generation would have After the three-month trial, every Missing a KPI with an agile business TURNOVER £17m (2018) some ingrained practices that suggest it is coming because the retailers see bought their first new car in their mid-40s, sales executive chose the higher basic. often prompts immediate action, but PROFIT BEFORE TAX £105,000 (2018) would love consumers to come to the consumers are here. We keep building having bought five or six used cars before Denton said: “As an employee, you’re Denton’s experience means he has NEW CARS SOLD 500 brand website. But Google estimates the best consumer experience, providing that, and the new car was aspirational. looking at it thinking that the pay plan is learned to be more patient. USED CARS SOLD 750 60% of car buyers don’t visit the brand easy search by finance and adding in Our generation likely bought our first new changing as a way to pay less. He said: “Changing things can often NUMBER OF STAFF 45 website, they’re probably going to deal-building capabilities, such as part- car in our 30s after two or three used “If we change it, we want it so we mean you wade out deeper into the SALES FRANCHISES Suzuki (2), earn more as a business and they can swamp. I’m conscious of not reacting too Mitsubishi (2) earn more as a salesperson.” quickly and I’m getting better at that.” NUMBER OF LOCATIONS 5 He said this is because compared with
34 MAY 2019 am-online.com am-online.com MAY 2019 35 INTERVIEW SUPPLIER ADVERTISING FEATURE ADVERTISING FEATURE Instant quality ‘Ballpark figure?’ control of valet Stop the shopper cars. The fear of retailers and brands is WE DWARF THE gathering their feedback, what they that Generation Z doesn’t want to own actually like about their cars, rating their The ‘what’s my car worth?’ question has cars any more, they want usership. But MANUFACTURER own model, and we have more than and images to be handled carefully, says Simon Bowkett people still tell us they want exclusive SITES, WITH 10 250,000 reviews by now. of Symco Training access, and the Generation Z members So consumers can see the expert By Michaela Gunney, How do you deal with customers we interviewed recently told us they TIMES MORE MINUTES review from our editorial team, and UK sales director, Secure Automotive Support would like to get their first new car at the SPENT ON SITE THAN information from people actually owning who say: “Can you give me an age of 23, after just one used car, and on one today. Secure’s newly developed digital idea of what my car is worth? I a monthly payment. So people still plan THE COMBINED WEBSITES Auto Imaging app means our won’t hold you to it, just a to get one, and finance is enabling them OF ALL MANUFACTURERS What success have you had with new automotive industry clients can now ballpark figure.” to do so. The more accessible you make cars so far? book valets and images with the Often you will get this in the first it to more people, then it’s an opportunity IN THE UK The first new car stock went online in benefit of instant quality control couple of minutes of the sales more than a risk. August 2018. Since the start of this year, (QC) and immediate acceptance process, and you cannot really give them a figure So, in attracting a customer at such a IAN PLUMMER, AUTO TRADER we have seen 1.3 million unique users or rejection. at this stage. But you can’t just tell the customer: young age, it’s the brand’s and dealer’s engaging with new cars on Auto Trader. Our Auto Imaging division app improves image opportunity to win their loyalty with the – there’s an expectation of always getting In the first 10 days of March, we had 1.1 “Hold on a minute, we don’t work that way.” That right experience and level of satisfaction, some support from the brand or retailer. million ad views of new cars on our site. quality, speed of upload, and instant QC. It is being won’t work with today’s clued-up buyers. We need isn’t it? By showing the level of discount There are currently 32,000 new vehicles used by AM100 dealer groups, used car superstores to find a way to work with the grain, not against it. There’s always an opportunity, if they available on Auto Trader, we’re bringing listed. Clearly, that figure is dwarfed by and fleet solutions businesses across the UK. keep the experience and satisfaction transparency to that journey. what we do with used cars, but the Word track across sales and aftersales, and use the Consumers don’t even know that 75% opportunity is significant. It will be a paid Digital backdrops Try something like this: “Sure, I’d be happy to get proposition as of July 1. We are having CRM tools available. The challenge is of new cars are held in stock in the UK Instant upload is possible during the capture that for you. Let me show you the science we use to that consumers are less inclined to be and are ready to buy. They expect they discussions with retailers about the value process, or digital backdrop changes can be added get the best price for your car. We’re not just going loyal now. They change so frequently, will need to tailor their car and get it built they are gaining from this – more than before automatic upload to your choice of website. that they feel like trying something else. at the factory. Consumers are telling us 1,000 already put their new car stock on to go to some website or guide, or just pluck it out Real-time quality control and digital editing of they would pay more to get the car they Auto Trader. the air. I’m sure you’ve been to some websites How do you see the market evolving want quicker, rather than having to wait internal and external shots is of the highest quality already. in 2019? for long delivery times. How are you tackling the complexity – we believe that backdrops should sell your “If you tell me all the good things about your car, We have focused on developing a new car of incorporating all manufacturer dealership as well as the car. Quality shots of your I’m going to take some photos of it and give them But aren’t you creating a nationwide incentives and sales campaigns to journey that we believe allows consumers site have a positive effect on those looking at a to my boss. He’s called Darren. Even though it’s a a much easier search for their ideal car. competition? correctly reflect new car pricing? multitude of similar vehicles online. car we might sell ourselves here, what Darren It’s helping to better match their demand It’s not across the whole nation, it’s within Auto Trader is working with vehicle to an industry level of supply. What a 50-mile radius. By doing it this way, manufacturers and their captive finance usually does is call a few independent buyers. Video voiceover and branding They’re the people who don’t have the overheads happens currently is that more than we’re allowing people to see a fair price, houses to plug their own retailer offers Our professional video solution offers automatic 100,000 new vehicles will be buried from but a local price, but it avoids the risk of into the new car stock advertising. We that we have here. That’s going to take 20 minutes stabilisation and optional branding with bespoke view, under wraps in compounds or in the most desperate retailer – who is already have links with retail offers with or so, are you all right for time?” music, text, voiceover and logos all available. transport. prepared to sell cars at a potential loss eight manufacturers and we are in FACT That’s how you set the agenda. And after you’ve The Secure Dealer Portal shows the percentage of The product we put in place last year – making their price visible to everybody advanced discussions with 10 others. FILE looked at their trade-in, you can then follow up vehicles displaying videos on the web. tackles this. We are aiming to offer a one- who has no intention of crossing the We’re looking to engage with all with: “As I said, that’s going to take Darren 20 stop shop, allowing consumers to shop country to buy their car. manufacturers to factor in finance and COMPANY: Vehicle tracking software shows what cars need minutes or so. While he’s doing that, let me show across Auto Trader and compare cars With 9.3 million monthly unique users deposit contributions into each individual AUTO TRADER videos and are available at any given time. across new, used and nearly new, coming to Auto Trader, we dwarf Google stock advert. HEADQUARTERS: you how well the new car drives.” because they usually don’t have a clear – with four times as many automotive Some of them are less speedy to LONDON Unified valeting and imaging term searches. We dwarf the manufac- engage because it’s quite sensitive data. Stop the shopper view of what they are looking for. TURNOVER: Secure Automotive Support is a UK-wide operation We are also trying to give a level of turer sites, with 10 times more minutes We have partnered with Codeweavers, Sometimes you will be dealing with a customer £330M (2017/2018) providing drivers, valeting services, inspection and transparency around price. New car spent on site than the combined websites the same company we partner with for PROFIT who you can tell is determined to shop around the progress chasers at almost 400 locations. pricing is so murky with the manufac- of all manufacturers in the UK. all the retailer finance solutions and that BEFORE TAX: other dealers who sell your brand, to get the best We manage volume spikes, chemical and turer RRP not really worth an awful lot. That gives us huge scale. We see what provides us with a pipe through to the £211M price for their car. Watch my new sales training The consumer knows they’re rarely likely the consumer is actually doing and captive finance houses. equipment supply, health and safety matters, along video on the AM website this month (am-online. to pay that for most volume car brands thinking about cars. We are now TIM ROSE AND TOM SEYMOUR with all current compliance legislation, so that our com/symcotraining, or at symcotraining.co.uk) to clients can concentrate on their core business. find out how you can adapt the word track above With our Auto Imaging division firmly established, to psychologically convince the customer that there we provide an unmatched unified solution. TUESDAY, MAY 21, 2019 is actually no need to shop around at all. It won’t ■�Call 01480 216 700 or visit www.secureplc.com Automotive Retail RICOH ARENA, COVENTRY work on every customer, of course, but it’s been BROUGHT and www.autoimaging.co.uk CONGRESS TO YOU BY very successful for me. UNDERSTAND THE NEW RETAIL LANDSCAPE Sponsored by Visit our website for a free training trial For further information and to book, To find out how our low-cost, IMI-approved online www.secureplc.com training programme can help train your team, visit visit: www.amretailcongress.co.uk symcotraining.co.uk/freetrial and start your free trial today. For sponsorship enquiries, please contact [email protected]
36 MAY 2019 am-online.com INTERVIEWS MANUFACTURER
the headlines for the Italian brand following a public debut at the Goodwood Festival of Speed last summer, the Trackhawk’s £89,999 price tag and 710PS V8 engine asserted the 4x4 brand’s presence in a FCA GROUP super-premium part of the segment. “That’s a car that will really help to build profile,” said Leclerc. He added: “Quadrifoglio and NRING are part of the Alfa Romeo DNA now, too. The UK is our biggest market for these prod- After a torrid 2018, MD Arnaud Leclerc is counting on premium products ucts, so we have to encourage all our retailers to sell them and offer the levels of and customer experience to turn things around.Tom Sharpe reports service that the customers expect when buying them.” The FCA Group has its own UK training he description of the FCA an increased number of headline-grabbing centre, near its Slough headquarters, and Group as a “challenger iconic models and a focus on delivering the Leclerc said this had helped it to meet brand” by its managing levels of service expected by the type of retailers’ needs for increased technical and T director in the UK, Arnaud customers who buy such products. sales training as more special editions enter Leclerc, felt like a stark Leclerc – just 14 months into his role at the line-ups. appraisal of its position during a recent FCA UK – said: “In the UK, it has been Leclerc believes the new Wrangler, interview with AM. very much a period of building strong launched earlier this year, will conquest While Leclerc may have been referring foundations to enable us to further build former Land Rover Defender customers. FCA is launching an increasing number of specifically to the Fiat, Alfa Romeo and Jeep strong brands. headline-grabbing iconic models, such as Jeep expects to double its 2018 Wrangler range’s push for greater prominence in the “When I joined, I realised straight away the Alfa Romeo Stelvio and Giulia NRING sales of 448 in 2019, according to Leclerc, fleet sector, the comment could easily have that the focus had to be on customer but those sales expectations suggest it will been applied across the group as a whole, experience. It was clearly something that remain very much a niche product. following its fairly dismal 2018 registrations we needed to emphasise within the FCA Abarth is another brand that appears to performance. IT’S IMPORTANT brands and really try and compete in the When asked about their current profit “It’s important that we are seen to be “It’s fair to say that we’re not yet there and have an importance not reflected by its Perception of the group’s status in the UK premium environment. return, respondents to the survey rated making an effort to understand and address some of our competitors are already saying sales volumes. has clearly altered as it has continued to THAT WE ARE “We must trust the network to deliver Citroën (2.3) and BMW (2.6) worst, but Jeep the concerns of our retailers.” that they are ready for the EV future.” Leclerc said: “Abarth isn’t the most struggle to live up to the profile of its brands SEEN TO BE that experience.” (2.7), Alfa Romeo (3), Fiat (3.1) and Abarth Leclerc is proud of the influence of the important in terms of volume for FCA, but (including Maserati, which suffered a 24.3% MAKING AN (3.5) duly followed – some way off the Model for success recently introduced flagship Jeep Grand if you take the volume we have done in 2018, decline in registrations during 2018) to slip EFFORT TO Dealer attitudes average score of 5.0. Retailers are clearly influenced by a brand’s Cherokee Trackhawk and Alfa Romeo that was a record for the brand and that well into the wake of other similarly- UNDERSTAND If happy franchisees are best placed to More worryingly, perhaps, was that Fiat, ability to deliver new products and the Quadrifoglio models to the FCA Group shows the potential. 50% of that growth last equipped groups such as Volkswagen and AND ADDRESS deliver a positive customer experience, then Jeep and Alfa Romeo slipped to the foot of NFDA survey indicates that the absence of line-up and feels retailers should be year was conquest.” the PSA Group. THE CONCERNS the FCA Group’s partners might not be in an the results when retailers were asked about an alternative fuel vehicle (AFV) from any of encouraged by the profile and profit margin In Q1, Fiat’s registrations were down 5.1% OF OUR ideal state of mind to fulfil Leclerc’s goals. their brand partners’ future profit return FCA’s line-ups is a concern. that such vehicles bring. Retailers’ FCA investment compared with the same period in 2018, RETAILERS He said: “In 2018, we tried to build a prospects: Fiat scored 2.9, Jeep 3 and Alfa The four brands finished bottom of the While the limited-edition Alfa Romeo FCA Group has been the subject of and its market share was just below 1.6%. ARNAUD LECLERC, stronger relationship and partnership with Romeo 3.2, against an average of 5.3. survey when retailers were asked how Giulia and Stelvio Quadrifoglio NRING stole more than one AM100 franchised In last month’s AM, our market intelli- FCA GROUP UK our retail network. When you do that, Leclerc conceded: “There’s still a lot to do, satisfied they were with their AFV offerings. gence review observed that “Once market you are able to be a little more demanding but since I started my role here I have been The replacement for the Fiat 500 is due to share falls below 1.5%, it is questionable of them.” working to build relationships reach dealerships in 2020, however, and will fca group registrations 2009-2018 whether a car company can still be called However, the group’s brands made up and that’s at the heart of what I intend to be sold purely in electric (EV) form – quickly four of the bottom six in the National mainstream”. continue doing.” transforming the manufacturer’s approach. 100,000 During the same period, Alfa Romeo’s Franchised Dealers Association’s (NFDA’s) FCA has a “franchise board”, led by At the Geneva Motor Show 2019 in March, Fiat Alfa Romeo Jeep registrations declined by 29.8%, after the Dealer Attitude Survey Winter 2018/2019. Motorvogue managing director Jon Pochin, meanwhile, Fiat showcased the Centoventi, 80,000 honeymoon period following the launch of When franchisees were asked to rate the and Leclerc said that a recent restructure an EV concept considered to be a precursor the Giulia and Stelvio into the premium FCA Group’s brands ‘overall’ with a mark has introduced sub-committees to address to the new Panda. saloon and SUV segments failed to out of 10, FCA’s brands fared poorly: specific issues within the network. The Centoventi featured a modest 60-mile 60,000 materialise. Abarth’s score slipped from 4.7 to 4.4 The board meets once a quarter, said range as standard, but allowed owners to Jeep, the clear focus of the FCA Group’s between surveys; Fiat rose marginally from Leclerc, who also places an importance on swap and add battery packs, boosting that 40,000 hopes at its annual Capital Markets Day last 3.6 to 3.7; Alfa Romeo went from a lowly 2.1 seeing his brand directors out in the field capability to 300 miles. summer, shed 10.5% of its Q1 registrations to 3.5; and Jeep remained flat at 3.4. All of and talking to retailers. “While our AFV plans have yet to be 20,000 year-on-year, leaving it with a market share FCA’s brands were below the survey He said: “I’ve asked for all brand directors announced in any great detail, what I can say of just 0.2%. average of 5.8. to be in the field as much as possible and is that by 2022 we will be able to offer 30 EVs 0 In its efforts to start ‘challenging’ again, Profitability and the future of its respective spend at least 20% of their time away from and hybrids,” said Leclerc. FCA plans to 123456789101112131415161718 FCA Group’s tactic seems to involve launching ranges were central to retailers’ concerns. headquarters each month. phase out diesel by the same deadline.
KEY PRODUCTS
Alfa Romeo Stelvio Fiat 500 Fiat 500X Jeep Renegade With prices starting at £36,990, Alfa’s SUV was Still the group’s biggest selling car 12 years Updated at the end of 2018, the 500X is Fiat’s The Renegade performed well in its first full year aimed at Jaguar F-Pace and Volvo XC60 territory after its 2007 re-launch as a retro city car, the entrant to the growing C-SUV segment. on sales, 2016, but registrations slumped by when it launched in 2017, but registrations fell 500’s sales were down 3.2% in 2018 (at 24,666). Registrations in 2018 declined by 35.5% (to 46.8% in 2018 and just 687 registrations in Q1 well short of its key rivals, hitting 1,131 last year. A new, EV-only Fiat 500 will be launched in 2020. 3,107), but were up 44.2% in Q1 2019 (to 1,181). 2019 left it down 11.4% year-on-year.
38 MAY 2019 am-online.com am-online.com may 2019 39 INTERVIEWS MANUFACTURER IN-DEPTH ADVERTISING FEATURE FINANCE & FUNDING It is time for self-service in aftersales
By Steve Ure, strategic account manager, FCA’s strategy is to deliver an increased eDynamix number of multi-brand centres, such as Snows Group Southampton Many industries now offer the opportunity for customers to self-serve. retailer’s portfolio restructure in recent understand our customers’ journey and Whether it be buying groceries and months, but Leclerc insists that the 211-site what they expect from us.” having them delivered to your door network is in good shape. or travelling to a far-off destination, Last year, Cambria Automobiles pared Fortunes in fleet back its representation of Fiat, Alfa Romeo Leclerc is keen to see FCA succeed in fleet the need to transact digitally with little and Jeep, closing its loss-making and feels the varied appeal of the group’s or no human interaction is becoming a must for Blackburn motor park – which held Fiat, cars, SUVs and LCVs makes it a key “chal- many consumers. Alfa Romeo and Volvo businesses under the lenger” to the UK’s biggest sector players. Doves brand – its Alfa Romeo and Jeep He said the group began to focus on its We have already seen it in the automotive sector operations in Chelmsford and replacing long-terms goals in the fleet sector in 2018. through vehicle sales where customers are able to Fiat at Warrington with its first Peugeot “We clearly wanted to decrease our buy a car online without ever setting foot in a franchise. presence in short-term rental,” said But Leclerc celebrated developments Leclerc. dealership. Now it is the turn of aftersales to provide elsewhere in the network which have The effect of this on the brands’ fleet a completely digital experience for regular furthered a strategy to deliver an increased registration figures was marked. In 2018, vehicle maintenance. number of brand centres – with all brands Alfa Romeo’s fleet registrations declined by on a single site. 17.2% to 1,522 (2017: 1,839), Fiat’s by 42.8% Customers will soon come to expect the ability to “Certain conversations have been difficult to 12,052 (2017: 21,070) and Jeep’s by 5.8% make a workshop booking online, drop off their keys since I started,” he said. to 3,258 (2017: 3,460). in a secure locker, authorise additional work digitally, “When you’re delivering 15% market Leclerc said the shift had allowed FCA share, those conversations don’t happen. Group to emphasise the approach to collect their car from the same locker and pay the bill We’re not there yet, but we have a plan, a customer service delivered by its business online, all without any human interaction. lot of new product development under way centre network and allowed its team of eDynamix has been working towards this goal for and retailers are also seeing that and back-office fleet sales and support staff and investing in our brands.” its field-based team of fleet managers to Credit,Credit, ccashash aandnd some time now and this year our aim is to be the first Snows Motor Group opened its £2 million help drive standards higher. provider to be able to offer this customer-centric, FCA Group brand centre in Southampton in “In the UK, we are considered a January 2018 – a month after opening a new ‘challenger brand’ so our next priority is completely self-serve solution all on the same single Fiat and Abarth site on the Isle of Wight. very much to ensure that people get to sign-on platform. how to keep the Vospers brought the four FCA brands know the strength of the products that we Our online service plan, workshop bookings, together in its £15m multi-brand site at have and the value they offer”. Matford Green Business Park, Exeter, in First-rate customer service and a electronic vehicle health check and AutoPoint lockers March this year. franchised dealer network that is prepared platforms are all already available to customers, FCA Group’s UK network now comprises: and equipped to meet the needs of fleet wheels turning allowing them to self-serve in a way customers of 146 Fiat franchises; 97 Abarth; 50 customers will be vital. Alfa Romeo; 61 Jeep; 73 Fiat Professional; FCA has 15 strategically positioned other industries can. Later this year, we will be 37 brand centres; and 43 combined Alfa/ specialist business centres and while making full use of our two-way CDK integration to Jeep locations. Leclerc’s ambition from 2018 to develop up An AM special supplement on the FCA’s motor finance review, allow customers to experience a totally seamless, Leclerc said the physical franchised retail to 40 such centres was still on the cards, he network is his current priority and there are said he is not willing to grow quickly at the completely digital experience. DiC schemes, commission disclosure, and business finance no plans to introduce an online new car expense of quality. n For more details, call 0845 413 0000, sales platform just yet. “I have faith in our retailers, but this is a email [email protected] or But following a tie-up between Amazon specialised area of the business and certain and Fiat in Italy in 2016 and the delivery of standards have to be met,” he said. visit www.edynamix.com Stelvio test-drive booking via the online “The ambition is still there to grow the retailer last year, he suggested the UK would business centre network, but we are be the second-most likely place for a trial. determined to maintain the highest HOW THE MOTOR FINANCE IN THE CUSTOMER’S COMMISSION DISCLOSURE FUNDING THROUGH A IS CASH KING? One development that the network should standards for our fleet customers and, as REVIEW AFFECTS DEALERS BEST INTEREST DECLINING MARKET benefit from is a new lead management such, it’s not a short-term goal. FCA CLARITY ON DEALER DEALERS SHED DEBT AND platform, which is being built by a third- “It is better that we are able to offer the THE FCA’S FINDINGS HAVE BIG ARE ‘DIFFERENCE IN CHARGE’ FEES IS GOOD NEWS, SAY COST CONTROL AND GOOD BUILD UP RESERVES TO party supplier. very best customer service from strategic IMPLICATIONS FOR THE INDUSTRY SCHEMES DOOMED? MOST OBSERVERS LENDER RELATIONS ARE VITAL WEATHER POTENTIAL STORM Leclerc said: “The customers we pass to locations and be sure that we are able to PAGES 43-45 PAGES 48-51 PAGES 53-54 PAGE 58 PAGES 61-62 our retailers need to be 100% qualified. offer the levels of knowledge and service “That system will also help us to that we demand.”
40 MAy 2019 am-online.com Sponsored by IN-DEPTH IN-DEPTH FINANCE & FUNDING FINANCE & FUNDING Sponsored by Sponsored by
Automotive HOW THE MOTOR FINANCE management Tim Rose, AM editor LIVE REVIEW AFFECTS DEALERS Money makes the world go round, so the 11 pages of articles, we examine the recent Cabaret song goes. But we have moved on in report from the Financial Conduct Authority The Financial Conduct Authority’s findings on commissions, information the almost 50 years since, and maybe credit and we expand on the particular issues of would replace money in a 21st-century version. difference in charge schemes and disclosure and affordability have big implications for the industry In the business of retailing big-ticket items commission disclosure. such as cars and LCVs, the availability of credit We also examine business finance. As the for individuals and businesses is crucial, which Brexit saga rumbles on, and growth in the UK he Financial and retailers should expect it. disclosure. He believes its such commission models could be is why we are examining the subject in ‘The economy is forecast to slow, business funding Conduct Authority’s But he added that those who conclusions should have been costing customers a combined Future of Motor Finance’ at Automotive and liquidity will become ever more important (FCA) review of the comply with FCA requirements based more on in-depth interaction £300 million more per year than if Management Live on November 7 and bringing in supporting daily operations and in picking T motor finance had nothing to fear. with lenders and brokers. they had used a flat fee model. you this in-depth look at finance and funding. In up any businesses that come on the market. industry is likely to “If you disclose the full facts of For example, on a typical motor have wide-reaching implications the finance deal to a potential COMMISSION MODELS AT RISK finance agreement of £10,000, for the automotive retail sector. buyer in a clear and timely fashion Among the key findings of the higher broker commission under The report, prompted by the before they have signed the report were concerns about the the reducing difference in charges FCA’s desire to learn more about agreement or handed over any widespread use of commission (DiC) model can add about £1,100 the sales process and record levels money, that person can’t turn models that give brokers wide more in interest charges for the of car finance amid concerns about around and say that you didn’t give discretion when setting interest customer over a four-year term. Adam Mepham, a lack of transparency and them the pre-contract information rates for customers. This can The review also highlighted motor sales director potential conflicts of interest, they needed to make a decision,” incentivise the broker to charge a concerns that lenders are not focused on three main areas – he said. higher rate and lead to conflicts of doing enough to monitor commissions, information However, Andrew Smith, FCA interest, with a link between commissions and protect the We are proud to be invited to contribute to exciting new strategies, initiatives and disclosure and affordability. subject matter expert for higher commissions and customer. And it warned that this special supplement focusing on finance solutions, combined with a considered Launched in April 2017, the consumer credit and motor finance increased interest rates, the pricing and affordability for and funding. The motor retail market has been approach, we are looking to deepen existing review analysed loan data from 20 at Paxen Consulting, said it was report concluded. customers could be adversely in a constant state of change and progress in relationships and establish new strategic motor finance providers, mystery somewhat unfair and The FCA estimated that affected if such commission recent years, which has meant that partnerships, by leading the way in point-of- shops of 122 motor retailers, and unrepresentative for arrangements break the link dealerships and supporting businesses have sale finance. a survey of lenders. the FCA to judge the between credit risk and the had to move at pace to continue to be In our Q&A on page 56, I give David Bilsborough, owner of whole market without customer’s interest rate. successful in the industry. our view on the future of the market and Cheshire Cars and founder seeing the complete The FCA said it is assessing At Barclays Partner Finance, we are hugely the final findings of the Financial Conduct member of the Independent Motor sales process, what action it will take, but enthusiastic about what the future holds. With Authority’s review. Dealers Association (IMDA), including possible courses of action include said the FCA’s method of commission consulting on changes to its mystery shopping was a consumer credit rules, common practice in retail banning DiCs and
Richard Jones, managing director
It was great to see the Financial Conduct adopting higher standards since the FCA’s Authority publish its long-anticipated report on adoption of motor finance regulation in 2015, motor finance. At Black Horse, we welcome the the objective of which was to deliver good and overall findings and the opportunity to work with fair outcomes and value to the end-customer. the FCA and the industry to respond. We felt it In discussing the 2019 report and its important, as a leading industry finance provider, recommendations, we must remember that its to reflect on the four key areas identified by the purpose is to ensure the market is working report, in this finance and funding supplement. well – for both a sustainable industry and for We have undoubtedly witnessed the market consumers. This is something we should taking a more progressive approach in all welcome.
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similar models, or limiting line their pockets,” he said. operational oversight of their always complete, clear or easy AFFORDABILITY ISSUES prepared to have some of the broker discretion. “Setting an arbitrary cap will brokers and dealers, which is to understand. The third and final issue the FCA conversations around Adrian Dally, the head of motor have a similar effect to what often difficult because the lender The FCA also said there was no identified was around commissions or finance finance at the Finance and happened with payday lenders, only gets involved at the end of a clear evidence of compliance with affordability assessment. The products, possibly because Leasing Association (FLA), said ultimately resulting in less choice sale when it receives the the requirements in its Consumer regulator said it was not satisfied declaring certain information the FCA’s findings were broadly in for the consumer and jobs and consumer’s application. Credit sourcebook (CONC) that all lenders surveyed were may cause the customer to ask line with issues it had also companies going to the wall.” “The FCA is more concerned on disclosure of brokers’ status complying with its rules for questions regarding commission identified, chiefly DiCs. But he Jerry Page, a director at about the total amount of and remuneration. It assessing creditworthiness, or interest rates that the dealer added that the figures were out of iComply, said it’s only a matter of commission received rather than reinforced the point that including affordability. or broker may not feel date and said the automotive time before the FCA will require what the dealer and broker earn brokers must clearly The regulator also reiterated comfortable answering. retail industry has made big full commission disclosure, to individually,” he said. disclose any commission that businesses are expected to “Fortunately, this is something strides since then. everyone’s benefit. He cited the “But the important thing is that or other financial have reviewed their policies and that can be remedied by formal “When we had a look into DiCs example of independent financial it’s done in a transparent arrangement with a procedures in view of the new interventions from senior in 2014, we took a clear position advisers (IFAs), who were subject manner. lender which could rules and guidance it published management at that dealership that it had had its time,” he said. to similar action by the FCA’s “I would imagine that the FCA affect their impartiality in in November 2018 and to make or brokerage. In other words, “The FCA’s figures relate to predecessor, the Financial will make these changes in small promoting a particular any necessary changes, adding senior management decides 2017. At the time it carried out its Services Authority. steps, demanding greater product or influence that it would follow up to make what compliant performance research, half of the near-prime “If you go back 15 years, IFAs oversight and understanding by the customer’s appear to take sure it had been done. looks like, and then makes sure and prime used car market was were required to disclose lenders of how their product is decision, as well the view that it is “Some lenders still don’t ask their systems and controls are still using DiCs, but two years as revealing the sufficient that a customers for enough basic suitable to police and monitor down the line we have moved on amount they broker is information about their income this approach.” and the vast majority have exited IT’S ONLY A MATTER OF TIME BEFORE THE will earn if FCA-authorised, as it and outgoings,” said Page. Smith said the review could that model.” FCA WILL REQUIRE FULL COMMISSION asked. can be assumed that “There’s still a lot of work to do also open the door to claims Car finance expert and DISCLOSURE, TO EVERYONE’S BENEFIT they will be compliant to make lenders consistent in management companies if ex-National Association of with FCA rules (as the their approach and to the FCA challenges the Commercial Finance Brokers JERRY PAGE, ICOMPLY FCA will monitor demonstrate that the product the enforceability of some DiC model director Graham Hill said in many compliance).” customer gets in the end is agreements. Therefore, he said cases, dealers and brokers will The report went on to say something they can afford.” brokers and dealers need to increase the annual percentage commissions and it didn’t destroy being sold by their introducers. It that companies should review activity and that of their brokers examine their past sales rate (APR) to be able to provide their business,” he said. also suggests the greater use of their policies, procedures and and dealers, implementing and INDUSTRY REPERCUSSIONS practices and identify potential customers with the opportunity to “After all, if you get a mortgage digital processes to check how On the lending side, the review controls to ensure they are maintaining a regime of As far as potential areas where exposures. pay off the finance owed on a or a life insurance policy, you can the transaction has been done.” also raised doubts about whether complying with all the relevant continuous oversight, feedback the FCA could demand change, Gerry Keaney, the chief part-exchange, or greater see how much commission is and to what extent lenders regulatory requirements and are and improvement, as per CONC,” Hill said lenders could be executive of the British Vehicle discounts or “freebies” in other paid to the introducer, so why TRANSPARENCY CONCERNS implemented controls to ensure treating customers fairly. he said. required to revise and reframe Rental Leasing Association, said areas. These could include tanks shouldn’t it be an obligation for The next area the FCA shone a that brokers – and retailers Martin Hill, the managing “The key point here is, as the their systems and controls the FCA needs to take a more of fuel, car mats, GAP and motor finance?” spotlight on was the provision of acting on their behalf –complied director of DealTrak, said it came FCA states, the lenders are regarding dealer and broker active role in supervising breakdown insurance, roadside But James Tew, chief executive sufficient, timely and transparent with CONC. as no surprise that many lenders potentially exposed to issues of relationships. lenders, retailers and brokers, assistance, warranties and paint of iVendi, said this would only information to the customer. The “Our work suggests that some were accused of having enforceability if introductions That way, he said, they will be particularly around unfair protection, or even options on the add further complexity because review’s mystery shops found lenders may be unduly reliant on insufficient oversight of their car have not been made correctly, or vehicle itself, he said. both the commission the lender instances where it was unclear contractual requirements and the dealers and brokers – a specific if those making introductions are “The position is by no means as pays the broker and the whether pre-contractual provision of standard requirement of the CONC incorrectly authorised.” THERE’S STILL A LOT OF WORK TO DO TO straightforward as dealers commission the dealer receives disclosure and explanations were documentation and procedures, sourcebook. Another problem, said Smith, MAKE LENDERS CONSISTENT IN THEIR upselling the interest in order to from that broker will have to be being made in enough time to and may not monitor brokers He said the fact that only five was current schemes for disclosed. The bottom line, he enable customers to make an sufficiently closely or act where out of the 20 lenders interviewed internal remuneration and APPROACH AND TO DEMONSTRATE THAT said, was that the lender will be informed decision. issues are found,” said the report. demonstrated systems and incentives for brokers and THE PRODUCT THE CUSTOMER GETS IN THE END IS required to have greater Where customers had been “We were particularly controls ‘broadly in line with dealers to sell financial products. SOMETHING THEY CAN AFFORD given sufficient time, the FCA concerned that some lenders CONC requirements at the time’, Changing that will require a big found explanations were not meant the majority shift in culture, he said. ANDREW SMITH, PAXEN CONSULTING had dealer and broker However, he added that arrangements which appear evidence from other sectors to be unfit for purpose. suggests that once the new complying with the FCA’s commission models, stepping in Smith said lenders will need processes are embedded and requirement on the provision of with enforcement where to rely on their own individual managed properly staff “become clear information and not required. He added that there approaches and judgement when motivated and incentivised by misleading the consumer. needs to be greater focus on assessing their distribution quality and good customer “Open and transparent affordability assessments and network. The downside, he said, outcomes, as well as obviously disclosure is seen by the FCA as lenders ensuring their brokers was that brokers and dealers being financially viable”. a fundamental prerequisite, and, comply with CONC. will have to contend with multiple “There are a number of historically, many dealers and “The time for excuses has audits carried out on them for approaches and strategies I have brokers have been passed,” he said. each lender they deal with. devised, for example, which uncomfortable with this level of “There is no place in the motor “The FCA will be looking for provide a balance between openness with a customer,” finance sector for companies that each individual lender to rewarding good productivity and he said. are unwilling to embrace the evidence that they are taking viability along with high-quality “This could be because many FCA regime and actively direct responsibility and work and good customer customer-facing staff feel demonstrate their compliance.” ownership of their monitoring outcomes.” inadequately trained or not ALEX WRIGHT
44 MAY 2019 am-online.com am-online.com MAY 2019 45 Advertising Feature
assumed that a customer would • Training and guidance – Affordability know or expect a commission finance providers have a role payment to be made, but this to ensure that dealers and Affordability measures must be must not be relied upon. It is brokers have access to up- aligned with the latest guidance incumbent on the intermediary to-date product guides and issued as part of PS 18/19. The FCA’s to be as transparent as possible training materials. Reinforcing about the benefits they receive some of these as mandatory The FCA’s concern here is that for introducing customers to will deliver regulatory some lenders’ affordability lenders. Only once a customer requirement consistency assessments are not aligned; understands the full package (for example on key product in particular there were a small MOTOR number of cases where policies can they determine if it is the information and commission right one for their needs. disclosures which may impact were focused on credit risk rather customer decisions). than affordability. This could have FINANCE Lender controls a significant adverse impact on • Tools and management a customer’s financial situation. Finance providers should not information – finance assume that FCA authorised providers can support Lenders and intermediaries have REVIEW intermediaries are fully intermediaries with accessible a key role to play in demystifying CONC compliant. management information the finance purchase process analysed to help them self-regulate for customers. At the time The FCA feels that some lenders on certain items, such as of purchase, this includes Product information are not taking reasonable discounting or financial assessing current affordability and disclosures steps to manage CONC promotions, etc. and seeking to reach an adherence within their understanding with customers Intermediaries, brokers, and intermediary networks. • Feedback loops – via on the factors which may dealers need to divulge key They need to ensure that they programmes such as mystery impede affordability through product features and other have oversight of the sales shopping or customer contact the lifetime of the product. forms of commission that It was great to see the regulatory disclosures, including processes in operation across post-sale, finance providers It means ensuring that generate a higher risk of poor long anticipated FCA’s the existence of commission their networks. They also need are able to understand customers are aware of the customer outcomes and report on motor finance early enough in the sales process to be aware of the information who is performing well and terms and conditions of their a greater distribution in customer being published. Its to inform customer decisions. provided to customers who needs more support. usage. This requires a clear rate and dealer commission. The throughout these journeys and This should form part of an explanation of the benefits purpose is to ensure the regulator implicitly reinforces the The FCA's report states that it is have confidence that customers ongoing dialogue and enable of the product and any market is working well for fact that a car finance proposition vitally important that customers get the right outcomes. continuous improvement and add-ons such as guaranteed both a sustainable industry must stand in isolation from receive key regulatory the sharing of best practices future values, servicing and and for consumers. This both a regulatory and a customer disclosures and product in the customer journey. insurance so that customers is something we should value perspective. Often the features such as implications of do not unknowingly incur all welcome. finance offer can be considered mileage, repayment, and vehicle There are no excuses for the additional charges. as one part of an overall ownership, before agreeing At Black Horse, we look lacklustre provision of guidance, package, together with the on the appropriate finance information, and support from In a rising interest rate forward to the opportunity price of the car being sold, the product for their needs. These finance providers to their environment, this becomes all to work with the FCA and part-exchange offer and other terms must be explained in intermediary partners. the more pertinent. Lenders the industry to respond. services such as warranties, clear, plain English and be easily must help their customers servicing and insurance. This understood by all customers. As consider if they can afford the Commissions enables flexibility in how the per Consumer Credit Sourcebook product long-term, particularly overall offer is constructed for (CONC ) legislation, the existence if housing costs go up. Half of More needs to be done any given customer, often to help of commission, in particular, all customers choose their car to protect customers from tailor the package to a customer must be disclosed before finance product based entirely higher risk commission models. need. However, the car finance entering into an agreement. The purpose of the FCA’s report is to on monthly payment with only It is worrying that the FCA offer must stand up to scrutiny in The commission amount must passing consideration to overall found that customers can pay its own right and will be judged also be disclosed on customer ensure the market is working well for both costs, which could be extremely considerably more due to some as such. request. It is perhaps widely a sustainable industry and for consumers. problematic in the future. adRocket
XXXXXXIN-DEPTH XXXXXXXX FINANCE & FUNDING Sponsored by !"#$%&"'()*'$++ ,-,'#%&*)."/&' IN THE CUSTOMER’S $/"'*0"'&$."1 BEST INTEREST? The FCA’s inquiry raised serious concerns about car dealers and brokers manipulating finance rates to increase commissions
n its report published in risk of reducing competition, so up their margin on commission from the early March, the Financial any changes need to be carefully finance deal. However, he said most Conduct Authority (FCA) thought through.” dealers he knew offered fair and I found a lack of evidence affordable interest rates and linking a customer’s THE DIC DEBATE commissions. interest rate under the Difference in Martin Hill, the managing director of Andrew Smith, FCA subject matter Charges (DiC) commission model and their DealTrak, said that when DiC was expert for consumer credit and motor credit score, because the rate was being introduced, it was seen as a way of finance at Paxen Consulting, said he didn’t determined by the broker or dealer’s dealers providing flexibility in their have a problem with DiC if the broker or ability to earn commission. commissions without being detrimental to dealer could justify their commission. One It added that it was not clear why the consumer. But he said the FCA now example of this, he said, was if they had to brokers should have such wide discretion clearly views that model as problematic arrange finance for someone who is self- !"#$#%&'()#%*+'+#,&'+#$")#,&'+#-+&-(+#'+".#'$.*+'#.*$"#&%"# when setting the interest rate under DiC. and open to abuse. employed or has just changed jobs or In total, the FCA estimated that these “DiC can encourage some dealers or address and further work is required to .*+/'#*&,+0#$")#/"1'+$0/"2#"3,4+'0#)&"5.#*$6+#1&"6+"./&"$(# commission models could be costing brokers to maximise finance commissions verify their identity or income. customers £300 million more per year in a way that is detrimental to the “If a dealership or broker genuinely has to MREV\RXPLJKWEHðQGLQJRXWWKDW\RXUFXUUHQW3&3 than if they had used a flat fee model. For consumer in areas such as affordability undertake a greater level of work to example, on a motor finance agreement of andand ssustainability,”ustainability,” hhee ssaid.aid. ““Also,Also, ttherehere securesecure a pparticulararticular ffinanceinance ddealeal f oforr a a -'&6/)+'#/0#$#(/..(+#&3.#&7#.&31*8 £10,000, higher broker commission under havehave bbeeneen mmanyany hhistoricalistorical eexamplesxamples o off the Reducing DiC model can add about dealersdealers rrequestingequesting vveryery sshorthort [[debit-back]debit-back] !"#$"%&'()*+&'',-#"&-(+./.+0$,123"+&*+1(*&4'(1+5,$+2*(1+3#$+627($*+89,+1,')"+ £1,100 more in interest charges for the oror nnoo ddebit-backebit-back ttermserms frfromom t htheireir l elenders.nders. customer over a four-year term. “Whereas“Whereas tthishis ccanan bbee lelegitimatelygitimately DOZD\VðWWKHFRRNLHFXWWHU,I\RXUSULQFLSDOOHQGHUWXUQVGRZQDQ The FCA said the onus was on the lender requestedrequested aass ppartart ooff aa bbalancedalanced r aratestes #00%&3#"&,':+"9($(+&*+#'+(;3(%%('"+39#'3(+"9#"+8(+8&%%+6(+#6%(+",+9(%0:++ to prove that any differences in commission and terms package for several ZKLOHRIIHULQJFRPSDUDEOHUDWHVDQGWHUPV rates were justified, based on the work reasons,reasons, iitt hhasas ppreviouslyreviously leledd t oto done by the broker or dealer. The review accusationsaccusations tthathat tthehe ddealerealer ccanan + also warned that pricing and affordability hold on to larger levels of <%$(#17:+,2$+./.+0$,123"+9#*+6(3,=(+#+-#%2#6%(+#11&"&,'+",+"9(+0$,123"++ for customers could be adversely affected commission – even if the $#'4(+#"+*(-($#%+=#>,$+1(#%($+4$,20*:+0$,-&1&'4+#+*,%2"&,'+5,$+2*(1+3#$+627($*+ if such commission arrangements break customer cancels their the link between credit risk and the agreement early due to the ZKRPLJKWRWKHUZLVHEHORVW customer’s interest rate. perceived high interest rate + It also raised concerns about they have been paying. This, ?9&*+./.+0$,123"+(=6,1&(*+"9(+89,%(+!"#$"%&'(+#00$,#39+@+5%(;&6%(+=,",$+ commission disclosure, particularly with in turn, may lead lenders to DiC and similar models, adding that focus on ways in which this ILQDQFHFRPSHWLWLYHO\SULFHGZLWKH[FHOOHQWVHUYLFHVWDQGDUGV lenders are not doing enough to monitor risk can be mitigated in commissions and protect the customer. their dealings with dealers :K\QRWJHWLQWRXFKWRðQGRXWKRZZHFDQKHOS\RXDQG\RXU# “DiC is a difficult issue to deal with and brokers.” because, in the main, dealers that use it David Bilsborough, the 130.&,+'0#.&)$9: do so appropriately and only a minority owner of Cheshire Cars and don’t,” said Louise Wallis, head of business a founder member of the development at the National Franchised IMDA, said the dealers who Dealers Association (NFDA). havehave llikelyikely bbeeneen aabusingbusing DDiCiC a arere “My concern though, is that if dealer thosethose wwithith aa llargearge sstocktock t hthatat t htheyey discretion is limited too much, you run the sellsell ooffff ccheaplyheaply inin ththee h hopeope o off m makingaking
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customer in difficult or exceptional evidence to indicate that if the rules of the make on their car finance. The unintended circumstances, then they should be market are changed to prohibit the use of consequence of all this may be an remunerated accordingly,” he said. DiC type models the consumer stands to increase in car prices. “The issue, however, is with brokers benefit,” he said. “Now they are looking at “The elephant in the room, in respect of whose income relies solely on finance who all of the options available and doing a changes to DiC, is the impact on income,” load the interest rate purely so they can cost-benefit analysis of each, which they said Shaun Harris, sales director at earn a higher commission.” will consultIN-DEPTH on before implementing the Codeweavers. “It seems inevitable that Smith said banning DiC, which the FCA is necessary changes.” there will be some knock-on impact on the reportedly considering, would be the wrong One alternative already being used by price of cars, notably in the used market. move: “In the right circumstances, it dealers isFINANCE a single interest & FUNDING rate, and, in “For this reason, and to ensure an genuinely rewards the broker or dealer for some cases, the same commission rate, orderly change, I expect that a rapid their work. Unfortunately, there’s not one regardless of the balance to be paid or the domino effect will take place as lenders silver bullet, because motor finance is such vehicle’s age, said James Tew, chief follow one another to reflect the a diverse industry with so many different executive of iVendi. regulator’s desired position well ahead of models.” “Many dealerships I have spoken to over any cut-off date.” Mel White, business development the last 12 to 24 months told me that since director at Jigsaw Finance, said: “The they introduced a fixed APR model they THE RISK TO REVENUES market has operated with these models In some cases, dealers who previously for a number of years and our experience MANY DEALERSHIPS I relied on DiC will suffer a steep decline in has found that competition within the profit. And the small margins made on the market has also had a policing effect on HAVE SPOKEN TO TOLD vehicle’s sale, particularly in used cars, Global Motor Expertise the rates offered to customers. In addition, ME THAT SINCE THEY mean ancillary products are often the only area where they can make up the shortfall. Q lenders have capped both rates and INTRODUCED A FIXED APR Part of a global banking group offering over commissions in recent years, so it is not Hill said dealers needed to focus on \HDUVH[SHULHQFHLQPRWRU✽QDQFHVROXWLRQV an open cheque book.” MODEL THEY HAVE ACTUALLY ensuring any commission they earn from DONE A LOT BETTER IN TERMS finance and insurance (F&I) sales is Q 1800 dealers in over 11 countries POTENTIAL FIXES derived from a wider selection of products The FCA said it’s still assessing what OF FINANCE DEALS such as GAP insurance, service plans and Q 16 manufacturer partnerships action to take, possibly consulting on JAMES TEW, IVENDI warranties. This also benefits customers changes to its consumer credit rules, because they have a greater choice of banning DiC and similar models, or products relevant to their needs, he said. BNP Paribas Personal Finance is a trading style of Creation Consumer Finance Limited and Creation Financial Services Limited. limiting broker discretion. have actually done a lot better in terms of “Also, selling ancillary products such as Adrian Dally, head of motor finance at finance deals,” he said. “The problem is insurance can drive more loyalty to other the Finance and Leasing Association, that the dealer may still struggle to justify parts of the business, such as aftersales,” believes the FCA will ban DiC and require its commission if, for example, the he said. “This approach demands a wider full commission disclosure in the same consumer does the whole process online vision in terms of F&I thinking, and of way as with mortgages, insurance and without its help.” course can come with additional investments. In turn, this will help improve Another solution is to have a flat fee for regulatory responsibilities, especially if the consumer confidence, he said. every finance deal written with a lender, dealer is going to be undertaking general “The FCA has found clear quantifiable but that may reduce the revenue dealers insurance activity.” ALEX WRIGHT
am-online.com MAY 2019 51
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he Financial Conduct third party in relation to a commission or fee or certainty and clarity is a benefit Authority’s (FCA) credit agreement or a other remuneration for all.” review of motor consumer hire agreement, payable to the credit Karl Werner, MotoNovo Finance T finance has been where the knowledge of the broker by the lender or deputy chief executive, said the critical of dealers, as existence or amount of the owner or a third party.” FCA’s conclusions have been clear. credit brokers, for failing to follow commission could actually or Adrian Dally, head of Dealers and other motor finance the Consumer Credit sourcebook potentially affect the impartiality of motor finance at the FLA, said brokers fell short of the required (CONC) handbook rules on the credit broker in recommending previous guidance on regulatory standards. disclosure of commission. a particular product, or have a commission disclosure was The CONC rules on commission Published in 2014, as the FCA took material impact on the customer’s “quite grey” and it wasn’t specific to were not warmly welcomed by responsibility for regulating transactional decision.” motor retail. A lot of the motor dealers when first published. consumer credit, CONC rule 4.5.3 CONC rule 4.5.4 continues to set finance review is spelling out very Where dealers do not disclose a states: “A credit broker must the tone: “At the request of the specifically what the FCA now commission they may called on by disclose to a customer in good time customer, a credit broker must expects from dealers. the regulator to defend their decision. before a credit agreement or a disclose to the customer, in good He said: “Members were doing This means they must record robust consumer hire agreement is time before a regulated credit this voluntarily before, but now this reasoning, and the processes of entered into, the existence of any agreement or regulated consumer clarifies the FCA’s views on how determining, why they believed a commission or fee or other hire agreement is entered into, the businesses should approach commission or fee would not remuneration payable to the credit amount (or if the precise amount is commission disclosure. It levels the influence the recommending of *Barclays Partner Finance is a trading name of Clydesdale Financial Services Limited, a wholly owned subsidiary of Barclays Bank PLC. Clydesdale Financial Services Limited is authorised broker by the lender or owner or a not known, the likely amount) of any playing field and having that any product, nor affect the and regulated by the Financial Conduct Authority (Financial Services Register number: 311753). Registered in England. Registered No: 2901725. Registered Office: 1 Churchill Place, London E14 5HP. Calls will cost no more than 7p per minute plus your phone company’s access charge. (International calls will be charged at a higher rate – please check with your telecoms provider.) To maintain a quality service we may monitor or record phone calls. BPF/MDS3/0119
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work we do. Reputable ourselves for a future scenario lenders and dealers have where we could get sued?” nothing to fear. “The alternative is for our COMPARING COMMISSIONS trade to halt offering Neither Smith nor the dealer group convenience and drive F&I boss envisage a scenario everyone to the banks and that where customers are shopping would be a really bad outcome around to see which dealer has for everyone.” the lowest commission. A finance and insurance Smith said the key thing for director at a large franchised consumers is whether they are dealer group, who asked to remain happy with the deal, the APR and anonymous, believes much of the the monthly payments. industry has already moved to flat He said: “Consumers are fully “With commission rates in an attempt to aware of interest rates at the this will make sure sales executives are dealership, and personal loans. TAKING FINANCE come unbiased. They know what’s reasonable and sustainability and Yet isn’t the FCA’s concern aimed what isn’t. If a dealership set an longevity for the at dealership level? Manufacturers’ APR at 19%, they simply wouldn’t sector in the face of finance houses continue to sell any vehicles. TO THE NEXT LEVEL emerging broker models incentivise their franchised dealer “Yes, finance is an additional that feed on the back of networks to achieve high volumes revenue stream, but as long as it’s customer’s decision to sign. dealers’ efforts.” of PCP renewals and repeat not an abhorrent level of profit and Werner said: “Where any Ivendi chief executive James Tew business, at the same time as it’s not to the detriment to the dealer’s reluctance to share the also believes better solutions and making their offers attractive to consumer, I think that’s OK.” Our dealers have told us they want a simpler, availability of commission exists, processes must be put in place: prime customers through low The growth of websites such as faster finance process. One that helps build the review makes it clear that this “This is very much a clear shot APRs and deposit contributions. Carwow suggests consumers want must end now.” across the bows for motor finance The FCA hinted that these transparent pricing, and confidence customer relationships. So we’ve done it. Werner said the FCA has been companies and their approach to manufacturer-driven finance sales that they are getting a great deal. clear on the kind of controls operational oversight of demands are a concern. Its Some industry observers question lenders need to have in place to introducers [brokers]. The ultimate research found PCP dominated why this trend wouldn’t apply to Two new ways to help you unlock ensure dealers and brokers are sanction is probably that full discussions for new car sales, and point-of-sale finance – consumers aware of all of their responsibilities. disclosure of commission at the in some cases the customer’s can already visit aggregator customer opportunities: This includes controls around point of sale is made mandatory. clear desire to own the vehicle websites to compare offers on pre-contract disclosure of the “It may already be too late to outright was ignored or not given personal loans and insurance. • Portfolio 3Sixty, our market-leading availability of commission. avoid this, but the industry could sufficient weight in the process. The F&I boss said he thinks However, Werner said it is also certainly attempt to pre-empt any retention tool clear that implementation FCA action.” standards too often fall short – Neil Smith, operations director at WHERE ANY DEALER’S RELUCTANCE TO and this needs to change. Imperial Cars, said customers SHARE THE AVAILABILITY OF COMMISSION • Finance Online, our POS system provides He said: “The road ahead understand dealers need to be EXISTS, THE REVIEW MAKES IT CLEAR THAT outlined by the FCA will require remunerated for facilitating finance. a more bespoke service to your customers greater oversight by lenders. He does not see commission THIS MUST END NOW KARL WERNER, MOTONOVO FINANCE “We are committed to ensuring disclosure as a deterrent, but as a dealers are not just compliant with part of the normal sales process: Discover the next level of dealer finance at the FCA requirements, but brilliant “We’ll do what needs to be done to “Lower monthly costs associated consumers would be surprised by blackhorse.co.uk/nextlevel at using finance clearly and fairly the letter of what the FCA requires. with PCP were generally promoted how little commission there is in a to create sales. There is nothing to We’re certainly not going to fight it.” as the most attractive feature for car deal, so added clarity could fear from creating a better Tony Denton, the owner and customers when compared with help increase trust. He thinks part customer experience.” managing director of Batchelors other HP products. However, it of the process should also explain Werner said transparency for the Motor Group (see our interview with was not always clear that there that if a finance deal is ended early, industry is a no-brainer and him on page 30), said any dealer was sufficient balance between the the dealer will lose a percentage of compliance with the FCA’s rules is reluctance will be due to a lack of benefits and downsides of various their finance commission. simply a hygiene factor. understanding of the rules. finance options offered or He said: “Customers aren’t going Dealers are already using “With all sectors, there are available,” said the FCA review. to go through the process of finance online as a marketing tool. always bad apples and the net is While other dealers were finding the right vehicle, building Werner said that by building in closing on them,” he said. confident commission disclosure the deal and then do that across commission disclosure into the “Finance providers and the would not affect the sales process, all other suitable vehicles to finance process, there will be banks need to be accountable the anonymous dealer thinks it will compare the level of commission increased trust for customers here. If they follow CONC, then car become a barrier to getting a deal at different dealerships or groups. choosing dealer finance. dealers, almost by default, will all done with the customer. “They want to know they are He said: “I have no doubt that we become compliant.” “The number of questions we now happy with the overall deal and it’s will see a positive impact on Batchelors uses fixed-rate APRs, have to ask during the sales right for them. If it’s a reasonable consumer trust in dealer finance to help customers’ comparisons. process is phenomenal. You have to deal, the commission disclosure is giving rise to greater confidence in Denton said: “Customers expect ask yourself if we’re doing all this for just wallpaper, it’s there in the the entire traditional dealer model. us to receive remuneration for the the customer or reluctantly covering background.” TOM SEYMOUR
54 MAY 2019 am-online.com
BHL11167_AM_Rocket_A4_ad_AW_v2.indd 1 04/04/2019 09:58 FP_AM_BHL11167AMid3874377.pdf 04.04.2019 14:43 SPONSOR in association with SHOWCASE Advertising feature
A KEY CALL-OUT FROM THE The FCA review is an FCA REVIEW IS THAT LENDERS NEED TO TAKE MORE CONTROL ON DEALER OVERSIGHT. WE NEED TO APPLY opportunity for dealers A COLLABORATIVE APPROACH ADAM MEPHAM, MOTOR SALES DIRECTOR Motor retailers are increasingly vital to the sale of motor finance, says Barclays Partner Finance’s Adam Mepham, and lenders will work with them to achieve better customer outcomes
Were the findings of the FCA’s support them in developing their systems, encourage all dealers and lenders to see for all of our partnerships and it is Qreview of motor finance a surprise? controls and approach to offering finance. this as an opportunity. We should all be right that dealers look to lenders for The interim FCA Motor Report, reviewing our products, services, systems support and guidance. A published in March 2018, pointed to a What’s the key challenge to and controls to make sure they are focus from the regulator on commission Q the sector? driving consumer experience forwards. In What tools and systems have you structures. The final findings, For me, the key challenge to our essence, this is an opportunity for us all to Q developed to support your dealer unsurprisingly, have indeed called out A sector is the rise of non-traditional improve and that can only be a good partners as consumers explore their car commission arrangements, affordability lenders from the fintech (financial thing for the consumer and our dealers. purchase options online? assessments and disclosure of information, technology) community. I believe that With the motor industry moving ever which gives the industry a clear steer on legislation such as the new EU Payments Do you see the dealers’ role in the A closer to a retail model, customers are what lender standards are expected. We Services Directive, PSD2, rightly Q sale of motor finance becoming expecting to be able to self-serve to some welcome the review and findings, as encourages other sectors to look to more or less important in the medium degree. We have to be at the forefront of ultimately we are working together to consumer lending as an opportunity. What term, and why? this demand and an example of this is provide better customer outcomes. From I believe we will see are new entrants The expectations of the modern through our latest solution, Sign Anywhere, our perspective, anything which drives from some surprising areas. As a result, it A consumer are high. I believe this is which gives customers complete control of greater transparency and, therefore, is key that lenders are putting consumers largely down to us all spending so much the finance application journey and consumer trust, is a good thing. at the heart of what they do and time in the digital world, where we can enables them to start, review and complete understanding what a consumer is looking expect quick answers, access information the agreement wherever and however they How has Barclays evolved the way to achieve. That way, we can develop pretty much whenever we want and choose, using the device of their choice. Qit works with its dealer partners products and services that will naturally products are just a click away. I don’t see in recent years? be attractive and engaging to the end that the human element in all of this has What helps to differentiate We made a strategic decision three user. A good example of this is our Sign degraded, in fact I see that the human Q Barclays from your rivals? A years ago that our focus would be Anywhere product, which uses plain element has been elevated and is now Of course, we have great technical on the AM250 dealer groups and the English to help customers understand their more important than ever. With this in A ability and a strong brand; however largest independents in the UK market. finance agreement, which they can then mind, it is critical that dealers have the core strength for me are our area Our approach is to share a close working sign digitally on their mobile device. In fantastic digital experiences for their sales managers and regional sales relationship, helping to create stronger particular, when we combine this with customers, but, importantly, this needs to directors. The passion, experience ideas and innovative new strategies. If an end-to-end customer journey, it be matched and hopefully exceeded by and love of the sector is incredible we are able to provide a relationship significantly supports what customers are the physical experiences dealers deliver. and constantly makes me feel where the customer benefits and the looking to achieve in the buying journey. These physical experiences, such as the proud to be part of the business dealer benefits, then that is success. enquiry process, product demonstration we work for. I am not the only Should dealers see the FCA’s and explanation, handover of vehicles one who is impressed – our Commission disclosure and Q review as an opportunity? and more, must be executed at the dealers tell us that each year Q difference in charges (DiC) products If we can continue to drive trust and highest possible level of quality to exceed when we measure the were identified by the FCA as problem A transparency within the market, this the expectations of customers. Yes, performance of our relationship areas. What is Barclays doing, or has it can only be a good thing. So yes, I would dealers are incredibly important to the through client surveys. We are already done, in these areas? sale of motor finance and I feel their also a business that wants to In 2016, we identified that DiC models importance will continue to grow. give back and stewardship is A were no longer fit for the market and COMPANY PROFILE a core value across the whole since then we have moved away and How can finance companies work of Barclays. We engage with developed commission constructs that Barclays Partner Finance Q even more closely with their dealer our wider communities in support good customer outcomes. Key staff: Adam Mepham, partners in the future? many ways, for example by Additionally, it was clear to us that we motor sales director A key call-out from the FCA review is taking part in fundraising needed to apply strong client oversight in Visit: www.barclayspartnerfinance.com A that lenders need to take more control initiatives, offering skills the marketplace, so we created a Telephone: 0844 811 7777 on dealer oversight. We need to apply a development sessions in dedicated team reviewing business Follow us: LinkedIn collaborative approach, guiding dealer local schools and practices and ensuring standards are met. partners by calling on expertise from our community initiatives. We are able to take a step back, review own business and the wider Barclays Importantly, we have with a Barclays lens and use our group, which will deliver real added value seen how these activities experience to identify potential in areas such as conduct. What is key is translate into a great improvements. Importantly, this area of our how we support our partners here and culture in our business seeks to work with dealers and now, but also focus on the long-term plan daily work.
56 MAY 2019 am-online.com am-online.com MAY 2019 57 IN-DEPTH FINANCE & FUNDING Sponsored by FUNDING YOUR BUSINESS IN A MARKET DECLINE
Cost controls and transparent performance updates are essential to retain lenders’ confidence
n an uncertain David Kendrick, partner at UHY [BANKS] ARE DEFINITELY NERVOUS ABOUT market, forecast to Hacker Young in Manchester, continue its decline believes banks are taking a more THE AUTOMOTIVE SPACE… STRONGER I from the 2016 peak pessimistic view of the automotive BUSINESSES ARE GETTING SUPPORTED, of 2.7 million new sector now. BUT THERE IS SELECTIVENESS ABOUT NEW FUNDING car sales, business funding may “They are definitely nervous become more challenging for about the automotive space, DAVID KENDRICK, UHY HACKER YOUNG motor retailers as banks become whether that’s linked with the more cautious, but investment in demise of High Street retail or He believes manufacturers have that the funders understand your stock, people and manufacturer property or the potential onset of begun lowering the capital business and not just the standards remains high. electric vehicles, I am not sure. expenditure pressure on dealers, headlines. The International Monetary Fund Stronger businesses are getting with a ‘softening of manufacturer “The new car market is down warned this month that “the credit supported, but there is requirements’, which frees up overall, but, as a Volvo dealer in the MIDLANDS cycle is maturing” and challenged selectiveness about new funding. capital for investment elsewhere, Thames Valley, we have a real global financial institutions to “act “The ways dealers are combating such as in digital technology. opportunity to grow the business. now to head off the growing risk of that is looking at all funding lines, John O’Hanlon returned to motor By sharing our ambitions and our In association with a major downturn”. whether that’s utilising all their retail in 2017 with his new venture, progress against these ambitions “Corporate debt and financial used car vehicle funding or Waylands Automotive. Some 18 we demonstrate that we can be risk-taking have increased. The leveraging the balance sheet to months after the sale of Ridgeway, relied on and that they can have creditworthiness of borrowers has generate working capital. People the AM100 dealer group he ran confidence in our business.” deteriorated… loans to highly are looking at their own businesses with owner David Newman, O’Hanlon believes by ensuring indebted borrowers continue to be and being a bit more savvy utilising O’Hanlon bought Wayland’s first Wayland’s key funders understand of particular concern,” said Tobias their capital.” Volvo franchise, in Reading, from its short- and medium-term Adrian, the IMF’s financial Kendrick said his clients are very Jardine Motors. He has since strategies and performance DATE: 18 SEPTEMBER 2019 counsellor and monetary and conscious of costs now: “Some acquired three more Volvo relative to the market, their capital markets businesses have had a good 10-year dealerships at Oxford, Swindon and confidence to invest in the business director. run of strong profits and when Newbury, and relocated the will continue. profits are strong, Reading operation into a new £6m Transparency, no surprises and VENUE: THE ICC, 8 CENTENARY it’s amazing how VRE-compliant site. regular updates on operational costs can creep O’Hanlon said: “We work with performance and achieving SQUARE, BIRMINGHAM, B1 2EA and additional both HSBC and Volvo Financial strategic goals means O’Hanlon head count seep Services to fund the acquisitions. maintains a trusted relationship back into the We fund capital expenditure from with funders. business.” bank loans (for larger projects) and It includes sharing budgets and retained profits of the business. plans in detail before the start of For membership and sponsorship enquiries, “With a business that can the year and updates every month demonstrate medium-term alongside quarterly meetings to contact [email protected] profitability and strong cash discuss strategy – although more flow, a reasonable regularly if a transaction is ongoing. or [email protected] business case can be O’Hanlon instils good business provided to funders practice at his sites and insists that that allow the the basics are covered every day For London Smart Transport highlights investments to without compromise. Maintaining be made. It’s strong management controls over important the company’s working capital www.smarttransport.org.uk means all stocks are funded and debts are paid when due. Weekly meetings to a strict agenda drive rapid operations decisions from Wayland’s management team. DEBBIE KIRLEW Headline strategic partners
58 MAY 2019 am-online.com IN-DEPTH FINANCE & FUNDING Sponsored by Hi dealers, Buy cars from anywhere with 100%* vehicle funding. IS
Talk to us: CASH ljƑƑljŏljƁăŏĊƆ nextgearcapital.co.uk KING? *100% of hammer price plus auction and delivery fees (auction purchases), or lower of CAP clean/invoice price (trade vehicles), + VAT funded on LCVs and qualifying vehicles up to the value of £45,000. cåƻƋ:å±ų±ŞĜƋ±Ĭ�UXĜĵĜƋåÚØcåƻƋ:å±ųBŅƚŸåØUĜĹčŸĀåĬÚŅƚųƋØĘåŸƋåųƚŸĜĹ域{±ųĩØĘåŸƋåųØBĉĿ)ţåčĜŸƋåųåÚĜĹ)ĹčĬ±ĹÚ±ĹÚ�±ĬåŸĹƚĵÆåųLjíƅĿƅŎƖƐţ�ƋŅÏĩĜĹč{Ĭ±ĹĜŸŸƚÆģåÏƋƋŅŸƋ±ƋƚŸØƋåųĵŸ±ĹÚÏŅĹÚĜƋĜŅĹŸţ Dealer groups are increasingly looking to shed Advertising feature debt and review practices around working capital to brace against falling new car Turn SMART repairs sales and an unpredictable into clever cash political landscape hile automotive leaders de-risking since the 2016 EU referendum, storm through debt reduction seems a cannot predict the UK’s in the knowledge that big-ticket purchases very sensible move by the sector.” Autoclenz is best known for its vehicle paramount. In today’s fiercely competitive different to your service customers will help future relationship with such as cars are the first to suffer when Daly said the risk of a post-Brexit sales W Europe, they are clearly consumer confidence fails. slump and the potential 10% tariffs on valeting services, but there’s a whole lot marketplace, you also need to exploit every to improve your customer satisfaction building up cash reserves The fall in sales of diesel cars following EU-manufactured vehicles is fairly severe, more to Autoclenz than cleaning cars. avenue for potential sources of new revenue. ratings. If this also means an improvement to face the challenges ahead. the Volkswagen dieselgate emissions- but added that lower gearing would Clients now benefit from a suite of services Autoclenz Smart currently provides on-site in the bottom line, then that is a real win-win. A recent report from UHY Hacker Young, cheating scandal also prompted dealers to certainly help to manage any challenges that can save money, increase revenues SMART repair services to many dealerships. the national accountancy firm, shows the start reducing risk. that occur. and improve your customer satisfaction. This not only helps the sales department Join our blue-chip client list top 100 dealerships in the UK have Daly said dealerships have managed to There are risks involved with focusing This month, we look at how Autoclenz can improve their vehicle turnaround time, but, Autoclenz is the regular winner of reduced their debts by 22% over the past shed debt by reducing capital investment, too much on cash rather than profit, such 12 months, to £9.7bn, down from £12.5bn off-loading property assets (through sale as depressing return-on-sales (RoS) help you deliver added value for your most importantly, it allows the service industry awards and is the preferred in the previous year. and leasebacks) and becoming more figures, particularly in an industry where customers and added profits for you, too. department to upsell customers with SMART supplier for eight of the AM100’s top 10 Dealers understand that if confidence focused on cash generation. In some average ROS is below 1%. repairs at retail prices, yielding significant dealer groups. Why not ask us how wobbles and the car markets sour, the cases, non-core overseas assets have Daly said: “There’s clearly a balance to danger will come from lack of cash flow, MORE AVERAGE also been sold. be had, but I think if you look historically at Earn a significant margin on SMART repairs margins for the dealership. So, why not use our SMART repairs solution could work DEALERS THAT Whether you’re a retail dealership, auction the service inspection as a launch pad to for you? not short-term lack of profits. Daly said: “The cutting of debt among the sector, they are highly geared UHY Hacker Young said the debt PERFORMED UK dealerships has put them in a much businesses, so I don’t think there’s a risk house, volume refurbishment or daily rental open the discussion with your customers reduction has significantly improved the WELL IN GOOD stronger position. of too many businesses going too far with operator, the ability to consistently deliver a about having cosmetic repairs carried out? financial strength of the sector ahead of TIMES… WILL “To date, dealership results have fared focussing on building up cash.” high-quality customer experience is Having the ability to offer something the expected Brexit-related slowdown in STRUGGLE AS THE well despite the fall in new car sales, Steve Le Bas, audit partner at BDO, said car sales. MARKET COMES owing to the strength of the used vehicle while it was good practice for dealer groups Paul Daly, partner at UHY Hacker Young, UNDER PRESSURE and aftersales markets. However, to build up cash reserves to absorb Contact Martin Peters, sales director of Autoclenz, on 01283 554 682, said UK dealerships have been gradually STEVE LE BAS, BDO preparing to weather any post-Brexit any shocks, there has been no email: [email protected] or visit: www.autoclenz.co.uk
60 MAY 2019 am-online.com am-online.com MAY 2019 61 IN-DEPTH FINANCE & FUNDING Sponsored by
specific push in this direction by the groups he is working with, which range from AM100 TOTAL DEBT LEVELS 2015-2018 £100m-£1 billion in annual turnover. Le Bas said dealers have told him Brexit £14 is less of a concern to consumer £13bn confidence than a potential change in £12 £12.5bn DEALER Government through a general election. BDO has not recorded any significant £10 movements in the market to sell off £9.7bn property or reduce headcounts either. £8 MASTERCLASS Le Bas said: “It’s actually quite difficult to £6 build cash, particularly if your stock is BILLIONS funded, it’s not going to release much £4 cash. You can sell excess property or close sites if you’re in a position to do so. A FAST AND £2 “Dealers have had a good five or six THOROUGH years and I think where we’ll see EVHC… £0 businesses caught out are those more INSTANTLY 2015/16 2016/17 2017/18 average dealers that have performed well INCREASES in good times, but will struggle as the CUSTOMER market comes under pressure.” SPEND more dealers are sitting on their hands balance payments from the finance Le Bas said cash generation can start KARL DAVIS, over dealership investment due to the houses, which is particularly critical COACHWORKS DEALER MASTERCLASS with cost control, although this will not political uncertainty, so that is during peak trading periods such as result in massive change overnight. CONSULTING safeguarding some level of cash. month-ends and especially in plate- He said: “Some dealers are looking at Clark said reviewing headcount is change months,” he said. costs more closely than others and the difficult because “how can you do that if Davis added that retailers can set a need to build cash is a concern, but we’re you’re still busy with customers?” policy of taking bigger deposits for new COMMERCIAL PARTNERS: not seeing businesses in dire straits that He said dealers’ fleet departments in cars and where lead times are long, have woefully unprepared.” particular could be hit due to the 8% such as with premium and luxury Le Bas did say that dealers are looking downturn in the market in 2018. brands, this can easily amount to to take their destiny into their own hands Daly said a review on working hundreds of thousands of pounds being and there has been less of an appetite to capital may reveal many potential held by a retailer over a period of time. VISION OF YOUR MARKET invest in facilities or start multi-million- improvements: “ ‘Back to basics’ is a “Setting a policy of larger minimum pound dealership developments. cliché, but we are still seeing big acceptable deposits is best practice in While Daly said he doesn’t think there disparities between dealerships from any business, as it not only improves will be large redundancies hitting the the level of cash in their businesses and cash flow but also strengthens the sector this year, he does think dealers it all comes down to tight processes.” customers’ commitment to see the need to review headcounts. purchase through to delivery, with the At Automotive Management Live on November 7, the Dealer Masterclass “Headcount is unfortunately one of the HOW SHOULD DEALERS BUILD anticipated profit being more likely to areas that does need looking at. It’s not RESERVES AND LIQUIDITY? eventually land.” programme will deliver advice and knowledge to dealer until you take a step back and look at how Clark said dealer groups have had an Davis said retailers should reconsider the headcount has expanded over the last eye on building cash and controlling cash-consuming corporate deals where management on a range of key topics that will assist them with the efficient years that it can become clear that things costs “for a long time” due to continued payment terms leave dealers waiting for aren’t in balance,” he said. pressure on margins and profitability. a month after delivery of the car to the and effective running of their sales and aftersales operations. Over the next six “I think it’s more likely that if people He said Brexit has not changed that. fleet customer until full payment is made. move on from a site, they may not get John Clark Group is reviewing all of In aftersales, actively promoting and pages, they offer a sneak preview of the intelligence that will be shared on the day. replaced, rather than lots of job cuts.” I DON’T its supplier contracts to make sure selling service plans at handover can Daly said UHY Hacker Young has tracked THINK IT they provide the best value for money. also provide a major boost, especially if an increase in sale and leaseback deals in [SALE It has cancelled several digital the plan is self-administered and cost the industry as a way for groups to AND LEASEBACK] marketing contracts this year after collected as a one off up-front payment. generate some cash. SHOULD BE realising it can tackle some areas Davis said: “One of our best-performing Find out more about Automotive Management Live at: www.automotivemanagementlive.co.uk “There is an appetite from the pension DISCOUNTED AS more efficiently internally. clients consistently does this and has built fund market to invest in dealership AN OPTION, Karl Davis, the managing director of up a £1m fund of customer prepayments. property right now, particularly if it’s a site PARTICULARLY Coachworks Consulting, said while not “And let’s not forget the opportunity to that has been newly refurbished,” he said. WITH SOME OF every dealer will have the opportunity to generate revenue as each car enters “Dealers have always been of the mindset THE RETURNS significantly cut their debt, all can the workshop, as undertaking a fast that they want to own their property, but I AVAILABLE examine practices that may have and thorough eVHC, then sharing best don’t think it [sale and leaseback] should be PAUL DALY, UHY slipped when the market was buoyant. advice with the customer in a discounted as an option, particularly with HACKER YOUNG At an operational level, Davis said, compelling and expert manner instantly some of the returns available.” dealers need to scrutinise processes increases customer spend.” John Clark, John Clark Motor Group and behaviours in both sales and A volume brand Coachworks AUTOMOTIVE chairman, said the ability to free up cash aftersales because there are “easy Consulting has been working with has in de-stocking vehicles is difficult due to wins” in boosting cash flow and liquidity. seen revenue increase by £15,000 per many manufacturers pumping product “In car sales, for example, ensuring month per site in labour sales alone. into the market for Q1 and Q2 to absorb finance customers sign their paperwork Davis made it clear this was not any Brexit fallout. at least 48 hours before taking delivery overselling, but just effectively advising Clark agreed with Le Bas’s view that of their car can speed up the transfer of the customer. TOM SEYMOUR
62 MAY 2019 am-online.com am-online.com MAY 2019 63 Advertising feature Advertising feature Make e-commerce work No car was ever sold seamlessly with your or serviced without physical sales operation a conversation…
e always overestimate ongoing testing for it to be successful. There are some concerns against the change that will occur We can make a judgement on what e-commerce, one of which is that it will nd today’s car shoppers in the next two years other industries are doing, but what increase competition from more distant and owners prefer to ‘W and underestimate the works for them may not necessarily dealerships. However, there are ways message over any other change that will occur in the next 10.” work for us. E-commerce shouldn’t act to reduce the risk of this, by focusing … A form of communication. When considering the automotive as a replacement for lead generation, on triggering positive associations LivePerson Automotive powers industry, it is certainly heading towards because it is still vital to catch those on why customers should buy from messaging for dealers to win customers e-commerce, however we are unsure of at the earlier stages of the conversion your brand, to stand out against the throughout the car buying process, when this will materialise entirely. We funnel, especially when 88% of competition, and build brand loyalty. keep those customers loyal during the believe that implementing e-commerce consumers won’t buy a car without Additionally, consumers today rely ownership journey and earn the right in automotive online showrooms is the test driving it, (SilverBullet, 2019). on online reviews. These have become to sell them their next new vehicle. logical next step in order to stay in line so important that 94% of people LivePerson Automotive powers with the changes in customer behaviour. have avoided a business because of messaging on thousands of dealer E-commerce should be used as a negative online reviews, according to websites, many manufacturer sites, method to unite the online showroom E-COMMERCE ReviewTrackers. As a complementary and ensures that when a consumer to the physical dealership, not replace SHOULD BE USED feature to e-commerce, dealerships should wants to message with dealers on it. Rather than having two distinct consider using a customer feedback Apple, Facebook, Google AdWords or channels, the two should work together AS A METHOD service or engage with customers on sites like Auto Trader UK, they can. to create the ultimate experience for TO UNITE THE ONLINE social media and review platforms. In fact, we were the first to offer the customer, no matter how they By 2030, it is predicted that the automotive Apple Business Chat to car dealers. wish to complete their user journey. SHOWROOM TO THE industry’s share of online purchases will ABC offers a new way for automotive We think customers should have the overtake that of appliances. In our opinion, companies to interact with millions of freedom to configure their own deal, PHYSICAL DEALERSHIP, it’s never too soon to start thinking about iOS users through messaging. With it, whenever and wherever convenient NOT REPLACE IT your digital strategy for the future. consumers will be able to see (and tap) for them. It’s the experience that a message icon beside your listings customers have come to expect, moving across iOS key dealer discovery forward with customer behaviour points: Safari, Maps, Siri and Spotlight. trends. In-store still matters, with 40% Shoppers can then gather information, of consumers expressing that it is schedule appointments, and more important to have a personal connection with brand app customisations – all at the dealership (Coxautoinc, 2015). within the native Messages app. Car buyers are becoming increasingly Since launching in the UK, dealers confident with their purchases, essentially have been able to sell more cars becoming their own salespeople. a week. In fact, Stoneacre sold This is a result of spending more time a car within 24 hours of going considering their decision online, live on Apple Business Chat and utilising vast amounts of information, three within the first week. to them throughout the servicing of their car owners can send pictures and including product reviews, offers and vehicle. Our service-based product videos to improve communication, comparisons. Eventually, e-commerce Higher show rates, larger R.O. sizes has been a proven tool for increasing and dealers can automatically offer will save showroom time for both parties. and improved CSI with service texting work approvals by 41%, as well as mobile pay to check-out. No downloads, As e-commerce is relatively new Soon, dealers in the UK will be able delighting both dealers and car owners updates, time-outs, or logging in/ within the automotive industry, it to automatically remind car owners of with the ease of communication out. All conversations are date- requires research, development and service appointments, and communicate offered from text. Both dealers and stamped, stored and easily retrieved.
For more information or to learn more about Autoweb Design, To learn more and start building your own conversational please visit www.autowebdesign.co.uk or get in touch on commerce plan, just reach out: Text 020 3095 7289 | 01757211700 or [email protected]. [email protected] | liveperson.com/solutions/automotive
64 may 2019 am-online.com am-online.com MAY 2019 65 Advertising feature Advertising feature Why the future of online motor All paths can lead to quicker retail may mean less for car sales (and Rome)
‘‘ t’s not the destination, micro-moment, customer This could mean £75,520 more for consumers, rather than more it’s the journey.” feedback on the process, online Consumer journeys are reviews, social media content, your yearly revenue if you I becoming more fragmented and and Google star rankings are all currently sell circa 40 cars per unique as different paths and digital crucial for growing revenue. By Rob Severs, vice-president pit stops are chosen by buyers before Where exactly do reviews fit in? 2 calendar month at £800 profit per unit. data and insight, iVendi making a purchase. Over time, these According to various experts, reviews t’s common to think about paths and digital pit stops are likely to should be on top of your list. Buyers advancing technology as become more unique and diverse. read reviews and consume online 1 something that always brings the This makes mapping your customer content before making a purchase. I consumer more – more choice, journey and optimising each step of Independent, verified customer more information, more options. the experience an ongoing process, as reviews outweigh unverified However, at iVendi, we believe the What We both digital and non-digital touch- (perhaps fake) reviews as buyers’ future of online motor retail may bring points or micro-moments continue to sophistication increases. less. Well, maybe not less exactly, ShoUld Be evolve to meet consumer demand. Ensuring these reviews are found rather the final outcome that you aIMIng FoR IS We will all have to keep an eye on your website increases traffic are looking for, delivered as soon as on rapidly evolving expectations: and optimises your search results, 2 possible in the buying process. pRoVIdIng the • Search experience generating more prospects and leads. Consider this in relation to vehicle RIght VehICle • Website experience Getting insight as part of the search, for example. We tend to believe • First contact review process also enable you it is a good thing if a customer carries and the RIght • Dealership experience or to prioritise other actions. 3 out an online search and the result FInanCe digital transaction According to our research, returns hundreds or even thousands • Delivery experience dealership experience is just as of cars. But it can also be interpreted paCKage at • Post-purchase follow-up important as your customers’ digital as a sign of failure. Why doesn’t it the RIght • Routine aftersales experience experience. Salesperson attitude, just deliver the nearest thing to the • Distress aftersales experience attitude at handover and the clarity exact car the customer wants? plaCe and • Vehicles experience of how paperwork was explained The same criticism can be applied to • Social media experience are all vital to drive customer delight 3 almost every stage of the online motor RIght tIMe – and nurturing raving fans! retail journey. What we should ultimately The checklist for a smoothly paved Of course, these behaviours propel be aiming for is providing the right customer journey can be daunting, each other, but, as mentioned vehicle and the right finance package works by looking at a dealer’s used want to buy, but using big data to create expensive and confusing for previously, a 20% improvement in at the right place and right time. vehicle stock and suggesting the an almost intuitive customer journey. dealerships. “Do I really need all of promoter score means an average How do we achieve this? The answer profile of a prospective customer. This It’s about using the information you these? Can I automate any of the of six fewer days to sell a car. 4 potentially lies in anticipating the will include factors such as gender, know about a customer to target their actions? How much will it cost?” At JudgeService, we are customer’s needs as much as possible, age, marital status, residency type, requirements as accurately as possible The answer has been clear: committed to ensuring our clients using advanced forms of profiling. dependents, occupation and income. at the earliest stage in the process. Optimising each micro-moment are well geared for the future. There are two main types now It can even drill down to profiling Of course, there is a second layer to increase customer satisfaction We will continue to ensure that becoming available. The first looks at a customer types on a derivative basis to this thinking, which is that some will lead to more enquiries the measurement of customer 4 user’s past activity. If you know someone so identifying the difference between customers will always want to take and quicker car sales.1 journeys is optimised with tools has been searching for a specific model purchasers of a five-seater versus a longer, more winding route to their Over the past three years, our such as reputation management of hatchback, priced between £7,000 seven-seater of the same model. purchase, trying out all the different research has proven customer software, online verified insight and £8,000, aged less than three years However, these examples show only the options and choices before making satisfaction has a direct correlation with and reviews, APIs, digital content old, having covered about 15,000 miles, first wave of the technology. In the future, a final decision. Technology will used car stock turnover – improving generation, social sharing and more. with a finance deal showing payment the level of granularity available about have to meet their needs too, but vehicle sales by an average of six days Our authentic, granular insight range between £140 and £160 a month how customers behave, about their for successive generations who are with a 20% increase in promoter score. will continue to help our clients and a deposit of £500, you can provide needs and desires, is likely to increase increasingly accustomed to online retail This could mean £75,520 more for enhance their customers’ experience, them with options from your stock. exponentially. We are not talking about making their lives as easy as possible, your yearly revenue if you currently enabling our clients to be the The second reverses that process, the annoying pop-up ads that follow delivering the right car first time is sell circa 40 cars per calendar winners in the world of tomorrow. using data gathered over time. It a lazy Google for something you may very likely to be the preferred option. month at £800 profit per unit. No one will remember Investing to improve each the fastest losers.
Founded in 2009, iVendi makes e-commerce solutions that make vehicle selling easier for dealers, vehicle buying easier for buyers, and vehicle finance easier for all. With Website: business.judgeservice.com offices in Manchester and Colwyn Bay and products connected to more than 7,000 dealer locations in the UK, iVendi believes in innovating to deliver results. Email: [email protected] Visit www.ivendi.com, e-mail [email protected] or call 0345 226 0503. Tel: +44 (0) 1423 225 166
66 MAY 2019 am-online.com am-online.com MAY 2019 67 Advertising feature Advertising feature Data is the backbone How video will evolve Working in a sector which is evolving at a pace that is outstripping the of a successful customer digital transformation of the past 20 years means CitNOW’s personalised video tools will be the key to blending digital and physical
contact strategy A BASIC REQUIREMENT, NOT A ‘NICE TO HAVE’ With almost 10 million videos hosted on the CitNOW platform in 2018 ealers are increasingly alone, video is now a necessity in handling and processing the everyday operations of a retailer. customer data. Following the Not only that, CitNOW research has D enforcement of the General found more than 50% of customers Data Protection Regulation (GDPR) in believe an online video tour of a 2018, dealers are capturing, on average, used car for sale is an important or 80% of mobile numbers and 88% of essential part of the used vehicle email addresses from customers making listing, which rises to 60% among those an enquiry. Of these, 70% of customer looking to purchase in two years. consents are captured for marketing Many manufacturers and dealer emails, 56% for marketing via mobile. groups now train their technician Post-GDPR, dealers still have a vast apprentices in the use of video and amount of data at their disposal. The video skills are fast becoming a ‘must key to a successful sales and aftersales have’ when recruiting sales staff. strategy lies in how that data is used. The greatest gains in the short Prospective car buyers still visit term will be seen on the web, where a showroom in person, but dealers video is becoming an ‘expected’ also need to handle enquiries from digital asset by consumers when inbound phone calls and emails, searching for a vehicle online. website enquiry forms, third-party the overall customer experience. the lives of their customers easier. Some classified sites, brokers and car price BRIDGING THE GAP already incorporate service bookings comparison sites, and various social In a digital-first world, video bridges ELECTRIFICATION and the option to request a video. As media platforms. This challenge isn’t offers and reminders with customers. the gap between the physical and With fewer moving parts, EVs require app usage increases, it is inevitable exclusive to sales teams, either – it Furthermore, more than 50% of UK virtual worlds, allowing retailers to less aftercare, but routine servicing is videos will be accessed this way, too. affects aftersales departments equally. Research carried out by Marketing car buyers are active on a social forge relationships with customers still necessary and the work required is Dealers have access to automated Delivery suggests that more than media platform, making it ideal for from afar. Video blends both less obvious. Unfamiliar terms such as TECH ADVANCES systems giving them the ability to 60% of customers are more likely lead generation. Marketing Delivery’s online and offline seamlessly by ‘battery conditioning’, ‘battery packs’ Cameras on iPhones and Android join up data from a range of sources, to book scheduled aftersales work SocialStock system enables dealerships, delivering the forecourt or workshop and different service cycles will need to phones are extremely high-quality and use it to provide customers if they receive a well-timed email groups and manufacturers to target onto the devices of customers. be explained. Explainer videos tagged and will only improve further with with a seamless experience. reminder a few weeks ahead of time. local customers or website visitors with CitNOW statistics show personal onto personal eVHC videos will help technological smartphone advances. For instance, a prospective buyer By the same measure, customers who dynamic Facebook adverts. Tailored video in response to a used car enquiry educate customers in these situations. The arrival of 5G will make watching will likely look elsewhere if a dealer have just purchased a car don’t want to to a brand or showroom location, reduces the number of no-shows by Sales staff will need to plug knowledge and uploading video content on does not have a specific vehicle in receive marketing for other new vehicles promoted social media posts can 30%, because the relationship has gaps, address concerns such as range handsets faster, of higher quality and stock. But instead of losing the sale, they now have no intention of buying. provide dealers with a valuable tool to already become personal. When used anxiety and using public chargers, with lower latency (the time for a video to Marketing Delivery’s Car Alerts system Customers are more likely to be maximise visibility and engagement. in the workshop, red work conversions and highlight benefits. Video is the play). In addition, video demonstrates in- lets dealers automatically alert that receptive to marketing messages if a For the motor retail sector, data can increase to 80%. With figures such perfect tool for this – a long verbal vehicle technology in just a few minutes. customer to details of relevant new business provides them with timely, should form the backbone of a as these, we expect video to be used in or written explanation can be stock as it arrives at the showroom, relevant information. Contacting successful customer contact strategy. more areas of the customer purchasing presented in minutes via video. PERSONALISATION using captured data to close a sale customers on the most appropriate However, customers will increasingly and owning experience over time. With 84% of customers saying being that might otherwise have been lost. channel can have a similar effect. 75% look unfavourably on those dealers The use of video – as part of the APPS treated like a person and not a Another example might be a of people in the UK use email daily, and who fail to also secure consents, and new car process, to keep a lead Video distribution channels will evolve, number is important to winning new or used car buyer receiving they are more likely to consent to email prove unable to use the data in a warm while waiting for a new model from the current email and SMS, into their business, personal video automated reminders shortly before marketing, making it the single most joined-up way to issue personalised, in the showroom, or for post-sales apps. Manufacturers are developing messaging will become even more an MOT or scheduled service is due. important platform to share relevant relevant and timely communications. parts and accessories – will become sophisticated brand apps to deliver important to maintain consumer more common and will enhance more connected services and to make interest and to engage car buyers.
Visit: www.marketingdelivery.co.uk Phone: 01892 599 917 Email: [email protected] The Brewery Business Centre, Bells Yew Green, Frant, East Sussex TN3 9BD Phone: 01189 977 748 Email: [email protected] Visit: www.citnow.com
68 MAY 2019 am-online.com am-online.com MAY 2019 69 SHOWROOM LAUNCH REPORT CITROËN C5 AIRCROSS: AIMING TO CONQUEQUEST WITH FAMILY-FRIENDLY COMFORT Q&A
£23,225 - has been changed quite significantly £32,725 this year, with an added emphasis placed on the French-ness. The ‘van rouge’ adverts have made a welcome KARL HOWKINS, return and there are other billboard MANAGING adverts which reflect that, too. Our DIRECTOR, French colleagues seemed quite 1.2 130PS AND CITROËN UK The cabin feels more premium 1.6 180PS PETROL; surprised that we were keen to than that of the Cactus 1.5 130PS AND emphasise the French aspect of the 2-LITRE 180PS How important is it for Citroën to have Citroën product. DIESEL a flagship SUV such as the C5 Aircross? It’s important in three ways. There’s Last year you told AM that Citroën’s always the need for a halo. C3 Aircross UK franchised retail network of 158 has done okay for us, although we was “probably 10 to 12 too heavy”. Has expected better – it is a car that should that situation changed? 0-62MPH bring people into the showrooms. C5 We lost 12 sites at the end of last year 8.2 – 11.8 Aircross fills that same brief and and the network size reduced from 156 SECONDS; widens our audience further, giving our to 144 – that size is about right for us TOP SPEED retailers more options. It also gives us now. Three new partners that we 117 – 134 MPH a presence in a part of the market we haven’t been with before have agreed have not been in before. We’re a to join the franchise and I guess that’s different brand to those that are down to relationships. I’ve spoken to already there – a bit more quirky. them and in some cases they are people that have known me from 6SP MANUAL, Is the aim of the C5 Aircross to before I joined the brand, so it’s good 8SP AUTO attract conquest customers? that we can work together. They’re We’re predicting that about 70% of C5 showing faith in what we’re trying to do. Aircross sales will be classed as ‘conquest’, with about 30% of What measures has Citroën taken to customers moving from other models help it achieve a degree of resilience in the range. It’s not just about to Brexit? 35.2 – 56.3MPG conquest, it’s also a vehicle that will We’re planning for the worst-case help us retain those customers scenario and hoping for the best. looking for something a little larger We’ve pulled a huge amount of stock and more premium-feeling. forward into Q1. At this stage, we still Citroen’s Advanced Comfort don’t know what to expect, but we’re programme gives the C5 Aircross SUV Three individually folding rear seats What is its marketing strategy? doing all we can to mitigate the effects a softer ride than some of its rivals 106 – 131G/KM offer family-friendly practicality Our marketing strategy as a whole of Brexit.
n an increasingly congested job of meting out extra traction in a range £32,725 for the Flair Plus fitted with a 180PS and a chunky leather steering wheel provide REVIEW RATINGS SUV market, Citroën is of conditions, and includes a hill descent two-litre turbodiesel and the PSA Group’s a greater sense of quality. bidding to carve its own assistance function. latest eight-speed automatic gearbox, The cabin feels a match for the likes of Kia PARKERS TOP GEAR WHAT CAR? I niche by selling its new C5 Meanwhile, the Citroën Advanced Comfort the focus remains on comfortable and and Hyundai, if not Volkswagen or Peugeot. Aircross with the promise programme employs hydraulic bump stops C5 AIRCROSS accommodating family transport. The boot can be adjusted from 580 to 720 of class-leading comfort. at the top and bottom of the suspension’s WIDENS OUR The mid-range Flair trim is expected to litres by sliding the three individual rear The C3 hatchback led the way with stroke to smooth out rougher road surfaces. AUDIENCE account for most sales – 52% – while the seats fore or aft, or up to 1,630 litres by technologies from what Citroën calls its Said to have been developed as a result of FURTHER, GIVING petrol/diesel mix will be close to 50:50, with folding them flat. KEY RIVALS Advanced Comfort programme back in the brand’s work in the World Rally OUR RETAILERS the BlueHDi 130 taking the lion’s share. As should be expected of a family-focused 2016, and the C4 Cactus followed. Now the Championship, it is quickly apparent that the MORE OPTIONS. Fleet:retail split is expected to be 48:52, car, there’s plenty of safety technology – C5 Aircross takes up the baton. simple but effective system does the trick. IT ALSO GIVES US with residual values averaging 49% at 30,000 automated emergency braking, lane-depar- A new model in a range now bereft of a The C5 Aircross’s wide, soft seats do lack A PRESENCE IN A miles and 36 months supporting a £230-a- ture warnings and blind-spot detection are family saloon, it delivers some of the flexible a little lateral support, but 15mm more PART OF THE month 36-month 5.9% APR PCP offer for the standard. The range-topping Flair Plus trim space of the C4 Picasso MPV along with padding than the norm boosts comfort. mid-range Flair 1.2 PureTech 130 (£25,325) adds traffic sign recognition, speed recom- some more rugged appeal. Progressive steering and a chassis which MARKET WE in conjunction with a £5,813 customer deposit mendation, automatic high-beam headlights The C5 Aircross stands 1,670mm tall – will yield to the physics of sharper steering HAVE NOT BEEN and £500 manufacturer contribution. and a 360-degree reversing camera. Renault Kadjar Peugeot 5008 Kia Sportage taller than the Kia Sportage or Peugeot inputs continue the relaxed feel. IN BEFORE There are cues from the Cactus – most An array of engine options are available LOW STARTING PRICE, STYLISH INTERIOR, STYLING, SEVEN-YEAR 5008 – and, while the absence of a four- This is not the most dynamic of the current KARL HOWKINS, notably the plastic ‘airbumps’ on the lower and a plug-in hybrid is due early next year. REAR LEGROOM SEVEN-SEAT OPTION WARRANTY wheel-drive option communicates a lack of crop of SUVs, but ridding it of the harsh ride CITROËN UK portion of the doors and side skirts – but the For now, the ‘entry-level’ 1.2-litre petrol off-road focus, 230mm of ground clearance of some rivals will be welcomed by many C5 Aircross feels more premium. engine will be easy to recommend to PERCEIVED AS COMMANDS FIRM RIDE, THE does provide a comfortable ride. potential customers. The door cards and some more discreet potential customers. UNDERSTUDY TO VOLKSWAGEN- DEFAULT CHOICE IN Citroën’s Grip Control system can be Priced from £23,225 for the 130PS surfaces feel a little cheap, but elsewhere, Citroën has stepped well and truly into the NISSAN’S QASHQAI RIVALLING PRICE THE SEGMENT specified as an option, which does a great 1.2-litre petrol-engined Feel trim version, to the tactile climate control rocker switches SUV fray with the C5 Aircross.TOM SHARPE
70 MAY 2019 am-online.com am-online.com MAY 2019 71 adRocket
SHOWROOM LONG-TERM REPORTS /,1.',6326$/1(7:25. SEAT ARONA SE TECHNOLOGY LUX REPORT PROGRESS
Seat dealers registered more than 4,800 Aronas in the first three months of 2019
PRICED FROM: £20,505 2QOLQHYHKLFOH DXFWLRQV 105PS 1.6 TURBODIESEL 6SP MANUAL
65.7MPG
ARONA OVERTAKES IBIZA IN SEAT DRIVERS’ AFFECTIONS 114G/KM /HDGLQJ /RZ ven at the most affordable to be decoded and explained by IHHV E end of an affordable dealership sales executives. YHQGRUV brand’s line-up, the SUV Thankfully the Arona handed to IURPe craze is being effectively harnessed AM for a three-month extended test to grip the attention of car buyers. came in the well equipped SE In the first quarter of the year, Technology Lux trim, with the Seat’s Arona – a car perhaps more out-of-favour but ever-so frugal accurately classified as a crossover 1.6-litre 105PS TDI diesel powerplant – generated 726 more registrations and a six-speed manual gearbox. than the Ibiza hatchback (4,802 to At £20,505, it’s not a third of the 4,076) in a period which saw way up the range and Seat is able to AMÕ registrations rise 12.2% for the brand promote a £189 monthly payment s Arona is in the well equipped SE Technology Lux trim as a whole. through its latest 0% APR online Early in its life, it is clearly PCP offers. delivering. It should prove an affordable STYLING TAPS IN TO THE SUV IS SEAT’S EASY MOVE RANGE Reaching showrooms during the family vehicle on an ongoing basis CRAZE AND IS ALREADY CONCEPT REALLY MAKING LIFE height of the SUV craze, with prices too, by virtue of 65.7mpg claimed DELIVERING SALES EASIER FOR CAR BUYERS? starting within £200 of the Kia Stonic fuel economy and 114g/km CO2 and Hyundai Kona, at £16,750, the emissions. It will accelerate to CURRENT 0 1 1 2 0 START 0 0 6 5 0 Arona draws on the styling of the 62mph in 10.5 seconds and has a MILEAGE MILEAGE 4XDOLW\ quickly established Seat Ateca to 115mph top speed. catch the attention of car buyers. Seat’s Front Assist monitoring KEY RIVALS Roof rails, a 1,552mm height system, automated emergency )RUJUHDWGHDOV (108mm taller than an Ibiza), and the braking and tiredness recognition XVHG option of a contrasting roof colour all system – standard on all Arona trim feed into the SUV-lover’s psyche. levels – helped it to achieve a five-star RQTXDOLW\VWRFN Whether last summer’s decision rating in the Euro NCAP safety test. VWRFN by Seat, as part of its Easy Move Among SE Technology Lux’s range strategy, to remove all standard features are the Seat Full WKHUHíVRQO\RQH optional extras from its models to Link eight-inch touchscreen make customers’ options clearer infotainment system with Bluetooth Kia Stonic Nissan Juke has made the transition to a and smartphone mirroring, adaptive SODFH\RXVKRXOG purchase any simpler is up for cruise control, heated front seats, a £20,720 FOR THE ALL- AFFORDABLE AND DISTINCTIVE, SINGING ‘FIRST EDITION’, SURPRISING REAR LEGROOM debate, though. wireless phone charger and a Beats 7-YEAR WARRANTY A total of seven trim levels (SE, SE sound system. SOGGY DYNAMICS, EHKHDGLQJ Technology, SE Technology Lux, On the face of it, Seat’s small LOWER TRIM LEVELS FEELS DATED, AWAITING Xcellence, Xcellence Lux and FR and package appears to be delivering on LACK VISUAL IMPACT REPLACEMENT FR Sport) offer a range of strengths many fronts. TOM SHARPE : OLQN'LVSRVDO1HWZRUNFRXN 7 72 MAY 2019 am-online.com
FP_AM_AMA4id3875978.pdf 04.08.2019 09:39 advertising feature SHOWROOM LONG-TERM REPORTS MITSUBISHI OUTLANDER PHEV 4H NISSAN LEAF TEKNA
REPORT REPORT Building a platform for success PROGRESS PROGRESS with long-term partners AX’s 13-year relationship with JCT600 is a case study in co-operation
uilding a foundation for long-term success should be the objective of B any good business, particularly in the ultra-competitive automotive industry. Yet it’s all too easy to get caught up in the here and now in the fast-paced, evolving THE BENEFITS OF PHEVS GO RANGE ANXIETY IS NOT HELPED world of car retail. Simply trying to shift stock and focusing BEYOND LOWER TAX RATES BY DEALER MISINFORMATION on quick wins is necessary at times, but can come at the expense of delivering long- ast November, the national press reported n my previous review, I detailed Nissan’s efforts term business growth. L claims from a fuel management company that I aimed at ensuring the transition from internal In its 17 years in the sector, AX has a large proportion of company car drivers with combustion to electric was as trouble-free as developed a steadfast reputation among plug-in hybrids (PHEVs) were not charging them. possible. But how effective have those efforts been? In the same month, the Government changed the There aren’t many Leaf owner reviews on the many of the UK’s largest dealer groups as a PRICE: £30,055 funding criteria for PHEVs, stripping subsidies from PRICED FROM: mainstream consumer motoring sites, but I found 19 on business focused on the long term. AX (EXTRAS: cars with a pure electric range of less than 70 miles. £39,500 three of the biggest – Parkers, Honest John and CarBuyer. works with half of the top 50 in the AM100, I can understand that for some business motorists, Among the 19, there is universal consensus that the METALLIC PAINT – £575, PROPILOT with an average retention of nine years – particularly higher rate income tax payers, the PHEV’s Leaf is a pleasure to drive and is offered with the right PARK – £1,090) almost unprecedented for automotive lower benefit-in-kind (BIK) tax rate is a big attraction. A features. Boot space, driving comfort (only having to use service providers. comparison on the Fleet News car tax calculator one pedal), acceleration, blind-spot warning, emergency One of its longest-running partnerships – between an Outlander PHEV and a diesel Audi Q5, with braking, silent running and pre-heat function come in similar P11D value, found the Audi would cost a higher for praise across the three websites. The majority on with family-run dealer group JCT600 – has among the busiest in the country. For a bolstered JCT600’s lead-generation and rate taxpayer an extra £3,600 per year. Ouch! parkers.co.uk give the car a maximum five stars. also been a great success story for both family-run business with a fundamental bodyshop performance. The results have But I still cannot perceive why anyone with a PHEV BENEFIT IN “Surprisingly roomy for a milk float,” concludes one. SEGMENT SHARE businesses, delivering improved customer commitment to delivering customer service, been excellent, helping the dealer group to would never charge it. With grants, it is pretty cheap to KIND TAX RATE: But then there are the battery life and recharging service and a greater platform for lead- that pressure could be challenging. Not so consolidate the strong growth it generated 10.13% (Q1 2019) install a home charger – my 7kw Pod Point cost about 16% (2019/20) issues. Officially, the Leaf’s range is 168 miles. One (SOURCE: SMMT ) generation to increase bodyshop revenue. for JCT600, which has partnered with in 2017, and the partnership is now looking £350 – and it turns taking the kids to school and local reviewer claimed that is “widely over-estimated” and said accident management specialist AX for toward increased profits over the next year. nights out into low-cost journeys, with the added its real-world range is 128 miles at an average 33mph. The iniTial challenge more than 13 years and counting. Sam Tordoff, group operations manager satisfaction of not pumping out emissions. Another claimed their car rapid-charged just once. I can’t help feeling a bit smug when driving on electric Worse still, one reviewer claimed a salesman told him Founded in 1946, JCT600 started as a family- at JCT600, said: “Having worked with some around Peterborough. My focus has changed from the car could get from Glasgow to Ayr and back (a little run business and has maintained that Building for The long Term of the most respected brands in the world getting somewhere quickly to driving more efficiently. over 70 miles) with a range of 80 miles when he set off philosophy while growing into one of the AX and JCT600 first worked together in for decades, JCT600 is a business built on Our test Outlander recently turned in its best electric and yet he wasn’t able to make it without a recharge. UK’s largest independent dealer groups. 2006, and the relationship is a case study in trust – with manufacturers, partners and performance yet. On a Mother’s Day trip to Norfolk, with 2018 AFV Dealers have their work cut out reassuring and COMBINED RANGE SEGMENT SHARE (WLTP): The brand represents 21 of the most iconic how long-term thinking and enduring our customers. five of us and a dog aboard, it managed 25 miles on a educating customers. Perhaps putting the salient facts 12.2% 168 MILES manufacturers, from Aston Martin and partnerships can offer added value through “Our partnership with AX has been such full charge before the petrol engine cut in. on the side of a bus and driving it around the country Bentley to Vauxhall and Volkswagen, a more bespoke service. a success story because its service supports May my smug smiles long continue.TIM ROSE would get the message across.JEREMY BENNETT across 51 locations throughout the UK. The AX service directly handles all our customers and our business to the very With a range of brands and thousands of JCT600 customer enquiries, to effectively highest standards. Through building that PEACEFUL LOCAL JOURNEYS, IT I FORGET HOW TO OPEN GREAT LEVELS OF EQUIPMENT RISKS OF CONFUSING ENCOURAGES A NEW MINDSET. THE FUEL CAP AS STANDARD CUSTOMERS customers, JCT600’s aftersales team is manage the accident and repair journey. trust, AX has become an extension of our Having integrated into JCT600’s aftersales team, and we’re all seeing the benefits.” division in recent years, AX has developed Scott Hamilton-Cooper, director of sales CURRENT 0 2 1 9 9 START 0 0 3 7 2 CURRENT 0 7 2 7 5 START 0 2 5 1 2 a bespoke service for the retailer, creating a and operations at AX, explained: “We’re MILEAGE MILEAGE MILEAGE MILEAGE series of reciprocal partnerships with local now at the point where AX is an extension bodyshops to ensure that all not-at-fault of the JCT600 team; working as part of the GUESS THE CAR COMPETITION work is managed – whether by JCT600 or brand rather than on its behalf. The results See if you can identify this an approved partner – to deliver a mutually for us both have been overwhelmingly Mark Gretton, month’s model for your beneficial referral system. positive and offer a case study in what local business chance to win a £20 John development Alongside its innovative First Notification long-term thinking and enduring Lewis voucher. Email manager at Inchcape of Loss system, AX has significantly partnership can offer.” [email protected] with Volkswagen Van ‘Guess the car’ in the Centre, Cheltenham, subject line and include correctly identified your job title and company the Ford Probe in last in your entry. The closing month’s issue. For more information, please visit: www.ax-uk.com WINNER THIS MONTH’S date is Friday, May 10
am-online.com MAY 2019 75 TALENT TALENT PEOPLE DEVELOPMENT mOVERS JUST 7% OF DEALERS USE THEIR TaLENT ON THE mOVE ADVERTISING FEATURE FULL APPRENTICESHIP LEVY FUND The untapped Kristian Elvefors has been named as the new managing director of Volvo Car UK, power of social Two out of three survey respondents reclaimed 25% or less of their own money replacing Jon Wakefield. Wakefield, who has spent three years as Volvo’s UK managing director – following media marketing lued-up car retailers are THAT IT IS 41.7% of respondents engage in. three years as sales director – will move to C continuing to attract the talent of Stubbs said: “We have struggled to Sweden to become the managing director of By Anthony Gaskell, managing director, EMEA, tomorrow, but Apprenticeship CLEARLY attract fresh faces, but with our the manufacturer’s home territory on Reputation.com Levy confusion is depriving many of CONFUSION apprentices and outreach projects we are June 1, swapping roles with Elvefors. access to the funding that could help starting to get a new crop of really In his new role, Wakefield will also work Digital marketing may as well be them to develop. AROUND THE LEVY promising young candidates coming closely with newly appointed senior referred to as ‘marketing’ these days. AM’s Training and Education Survey 2019 THAT IS HOLDING through. vice-president of global commercial Direct mail and banners being the suggested that there is a gulf between the MANY RETAILERS “About two-and-a-half years ago, we operations, Björn Annwall, in the integration main source of advertising are falling, minority of retailers who are effectively decided that we wanted to forge strong and management of Volvo across the and for some, TV and radio TRAINING & EDUCATION accessing the funding and those who have BACK FROM relationships with local schools. We wrote EMEA region. yet to get to grips with the levy, which was RECRUITING MORE to 40 in the vicinity of our key dealerships Elvefors, a veteran of 16 years at Volvo in advertising can prove to be too introduced in April 2017. and the reaction was really good. KriStian elveForS, managing Sweden, has led the brand’s Swedish expensive. One of the easiest ways to Two thirds (66%) of car retailers who pay APPRENTICES “We started to visit to talk about director, volvo car uK operations since 2015 and will bring “huge build up a brand following and generate product into the Government’s Apprenticeship WITH ITS everything from application writing to Volvo experience to the UK market”, the awareness is via social media – which you probably Levy pot have drawn down just 25% or PROCEEDS IS A interviews and what they might expect brand said in a statement. knew already – but for some, it can be difficult to less of the fund they are entitled to, from working life.” Wakefield leaves Volvo Car UK having overseen a period in which new car volumes manage and hit the right notes. according to the survey’s results. TRAVESTY Vindis also opened its doors to work grew from 32,000 in 2013 to just more than 50,000 in 2018. Volvo’s Q1 registrations were As the number of dealerships under the same While 43% said they had been able to STEVE NASH, IMI placements, with 10 completed since last 39% ahead year-on-year, putting its target of 60,000 in 2019 within reach. claw back more, only 7.3% said they had summer and 60 applications in the pipeline. Wakefield said: “I have thoroughly enjoyed my time with Volvo Car UK, where we have group grows, having a centralised dashboard to roll used the full amount available to them. In total, 60.4% of AM survey achieved so much in recent years. out local campaigns in one click is essential. Most Some 83% of respondents said just 25% those funds by April 2019, when they were respondents said they accommodated “We have moved the business forward considerably for all Volvo partners, and I am businesses schedule content these days, but what is or less of their workforce had received due to be redirected to SMEs and other work placements, with manufacturer hugely grateful for the combined efforts of the great team here at Volvo Car UK, the often missing is a centralised overview of all types of training funded by levy contributions. DfE projects. partners channelling apprentices or strong retailer network and our suppliers in making these results happen. engagements, including comments, so you can jump The results of AM’s survey showed the school leavers into 62.5% of businesses. Just 16.7% stated that a higher right into the conversation and drive visits to your proportion of their staff had benefitted extent to which retailers need to invest in Vindis has 40 apprentices in its business from Apprenticeship Levy funding. their workforces in order to address the and Stubbs said access to the levy funds dealerships, not the competition. Until now. Steve Nash, the chief executive of the current skills shortfall. has led to a more mature crop. Reputation.com’s industry-leading online reputation Institute of the Motor Industry, said: “That A total of 52% said they will hire more “There has been a shift in expectations management (ORM) platform includes the Social it is clearly confusion around the Levy that people in 2019 than the year before, with too,” she said. “The people joining us from Suite, an enterprise-ready, scalable and user-friendly is holding many retailers back from the largest proportion (41.8%) stating that outside the sector are keen to know what solution to manage all social media within a single recruiting more apprentices with its the skills shortage was most keenly felt in their next step is and how they can get dashboard. The two most critical aspects of an proceeds is a travesty. their workshops. there.” effective social solution are publishing and engaging, “To date, just 15% of the Levy pot has Victoria Stubbs, Vindis Group’s director Arnold Clark has about 5,000 pending been spent.” of HR, said a commitment to attracting apprenticeship applications, according to allan ruShForth, and Reputation.com’s Social Suite has been The levy, imposed on companies with and training young recruits reduced the early careers manager Suzanne Sherry, Stuart rowley, managing director developed from the ground up with this and total a total pay bill of more than £3 million ongoing need to recruit staff through and the group uses its Apprenticeship preSident, Steve catlin, head For europe, visibility in mind. Ford europe oF SaleS, audi uK marque group a year, amounts to 0.5% of their total improved retention. Levy funds in the group and its associated From our customer research, dealerships that used pay bill. In December, Vindis joined forces with GTG Training business. Reputation.com’s Social Suite reached 40% more AM At the end of last year, reported that Anglia Ruskin University to launch a She said: “We know that in order for our Ford has appointed Steve Catlin will Former Lookers managing people than those who didn’t. Those dealerships also just £370 million had been drawn down graduate degree course, offering one business to continue to grow, survive and Stuart Rowley as the replace Peter Brookes director Allan Rushforth grew conversion rates 56% faster in the second half of from the Government’s £2.7 billion pot, candidate ongoing support and work thrive in a dramatically changing industry, new president of Ford of as head of sales at has joined Marque Group according to Department for Education experience during their studies. our workforce has to do the same and Europe as part of a Audi UK in June. as its new managing 2017, compared with the first half of the year. (DfE) data. The group has also started a schools that demands investment in the right series of personnel He is currently the director for Europe. Additionally, a ‘big three’ carmaker saw additional Employers that contributed had to use outreach programme, something just recruitment and training.” TOM SHARPE changes at the top of the head of sales at fellow Rushforth, who previ- profits of $36 million from increasing their Reputation manufacturer. Volkswagen Group ously held the posts of Score by improved social activity, review volume and Rowley joined Ford brand Seat UK. chief operating officer at higher rankings in search engine results pages. Motor Company in 1990 Catlin has worked Hyundai Motor Europe and Contact Reputation.com for a discussion about why as financial analyst for within the Volkswagen vice-president of Nissan’s ORM is the current focus for automotive digital HOW TO RECRUIT SPEAKERS FOR IMI APPRENTICESHIP Ford of Britain, before Group since 2015, global sales, joins to lead GENERATION Z SCHOOLS (S4S) LEVY ADVICE progressing through a joining from Vauxhall the strategic direction of marketing strategies. Annapurna Recruitment business Founded in 2011 by ITV’s political The Institute of the Motor Industry number of roles to where he was retail its UK and European- n Email [email protected] or call development manager Fridtjof editor, Robert Peston, S4S can (IMI) continues to be a valuable asset become chief operating sales director. based businesses as it 0800 066 4781 today. Storde examines Generation Z’s assist business leaders in their for car retailers looking for advice on officer for Ford North He will report directly expands its strategic foot- characteristics and expectations to efforts to reach out to the young how best to access and make use of America. to Andrew Doyle, print and influence across identify the recruiting techniques recruits of tomorrow through visits the Apprenticeship Levy funds available He has responsibility director of Audi UK. Europe, the Middle East that will best attract them. to the schools and colleges where to them. for the operational lead- Brookes, who had and Africa. www.am-online.com/ they study. For more information, call 01992 511 521 ership of the business previously founded He was MD of Lookers
RESOURCES RecruitingGenerationZ www.am-online.com/S4S or email [email protected]. unit, including accelera- BMW dealer Knights in 2017, reporting to Nigel tion of the European Group, will “pursue McMinn, chief operating transformation strategy. new challenges”. officer.
76 MAY 2019 am-online.com am-online.com may 2019 77 adRocket
TALENT INTERVIEW AM, Media House, Lynch Wood, Peterborough PE2 6EA Email: [email protected] THIS MONTH’S QUESTION TO THE AM TEAM: What’s your favourite riddle?
EDITORIAL EIGHT QUESTIONS TO AN... Tim Rose 01733 468266 Editor [email protected] Which word in the dictionary is spelled incorrectly? News and features editor Tom Sharpe APPRENTICE 01733 468343 [email protected] What belongs to you, but other people use it more than you? Web producer Elizabeth Howlett 01733 468655 LIGHT VEHICLE [email protected] Why is a raven like a writing desk?
PRODUCTION Head of publishing Luke Neal 01733 468262 TECHNICIAN What has two legs and flies? Production editor Finbarr O’Reilly 01733 468267 Mercedes López of RRG Kia What gets wetter the more it dries? Senior designer Chris Stringer 01733 468312 Bury on managing workload, Life getting it ‘right first time’ and CONTRIBUTORS Matt De Prez, David Francis, Debbie Kirlew, that crucial morning cuppa Jim Saker, Tom Seymour, Alex Wright PROJECT MANAGEMENT Head of project management Leanne Patterson 01733 468332 Describe a typical day in your apprenticeship What attracted you to this area of expertise? Project managers Kerry Unwin 01733 468578 LOPEZ: My working day starts with a morning briefing. LOPEZ: I have always been into car styling and specs Chelsie Tate 01733 468338 Next, I will empty the workshop of any customer cars or and always felt so at home behind the wheel, at Niamh Walker 01733 468327 courtesy cars, so that the ramps are free to start the day. racetracks and walking around car shows. It wasn’t until ADVERTISING Usually, I have 15-20 minutes to get some general a certain stage in my life that it dawned on me I could Commercial director housekeeping done, such as emptying the bins, before I take this passion and make it into a career. Sarah Crown 01733 366466 am designated my first job. After attempting an academic route that did not work Group advertisement manager I have been in my apprenticeship position for 18 months well for me, I ended up in a job that kept me well within Sheryl Graham 01733 366467 Account managers and I can carry out a number of tasks autonomously. I my comfort zone. It wasn’t until I had some life experience, Sara Donald 01733 366474 can confidently service a vehicle and can actively spot that I had the ‘cojones’ (as we say in Spanish) to enrol on Kelly Crown 01733 366364 faults and recommend work required. I have my mentor a Level 2 college course. Ever since then, I’ve been Kate Atkinson 01733 366473 working alongside me, who quality-checks my work. pulling engines out with my dad, rebuilding them, Recruitment enquiries 01733 366473 Besides servicing, I can be involved in maintenance carrying out repairs to my own trusty Fiesta ST, and I’ve EVENTS work, such as brake discs and pads, tyres and four-wheel been loving every second of it. Event director Chris Lester alignment. I also clock on to some warranty jobs. Event manager Sandra Evitt 01733 468123 The only thing left to mention is the high importance of What is the most important thing you’ve learned so Conference planner Nina Wright 01733 468907 Senior event planner Kate Howard 01733 468146 ensuring everybody has their morning cuppas delivered far in your training? at 10am…10.15 at the very latest! LOPEZ: Coming to terms with how important it is that I PUBLISHING do my job correctly was a massive lesson for me. It has Editor-in-chief Stephen Briers What are the most challenging aspects of your role? been drummed into me, that no matter the age, badge, Head of digital/associate editor Jeremy Bennett CRM & marketing manager Lauren Annis LOPEZ: The need to work to such time constraints can value of the vehicle, I am to provide an unrivalled service Managing director Tim Lucas be difficult for the qualified technicians, but more so for and to treat each job as though it would be my mum Office manager Jane Hill 01733 468319 an apprentice. Even though I am grateful for the freedom jumping in the driver’s seat. When you stop to think about CEO of Bauer Publishing UK Rob Munro-Hall Subscribe to AM and trust my colleagues have for me, sometimes I think the massive negative impacts that could be caused by www.am-online.co.uk/subscribe it gets overlooked that I am still learning. any negligence on my behalf, it really does cause me to 01635 588494 / [email protected] The workload in the garage can sometimes hit crazy be cautious with everything I do. UK: annual £99 / two years £168 / three years £238 Overseas: annual £149 / two years £253 / three years £358 levels. It’s a battle trying not to get too caught up in I take my time, I work methodically to my own routine, AM is published 12 times a year by Bauer Consumer Media Ltd, registered efficiency figures, and pressure from the service advisers in order to ensure all bases are covered. I never guess, address Media House, Peterborough Business Park, Lynch Wood, Peterbor- ough, PE2 6EA. Registered no.: 01176085. and workshop controller to get things done. It is all about I always ask for help where appropriate, and will always No part of the magazine may be reproduced in any form in whole or in part, without prior permission of the publisher. All material published remains the trying to find this harmony between being quick and ask for a second opinion if I am unsure.MATT DE PREZ copyright of Bauer Consumer Media Ltd. We reserve the right to edit letters, copy or images submitted to the magazine without further consent. The submission of efficient, yet ensuring everything is done right first time. material to Bauer Media whether unsolicited or requested, is taken as permission to publish in the magazine, including any licensed editions throughout the world. Any fees paid in the UK include remuneration for any use in any other licensed How is your employer helping you to overcome them? editions. We cannot accept any responsibility for unsolicited manuscripts, images or materials lost or damaged in the post. Whilst every reasonable care is taken LOPEZ: They allow me to test myself with tasks I haven’t QUICK-FIRE QUESTIONS to ensure accuracy, the publisher is not responsible for any errors or omissions nor do we accept any liability for any loss or damage, howsoever caused, previously encountered, and give me the chance to try resulting from the use of the magazine. Printing: PCP Complaints: Bauer and figure things out for myself. I secretly love that they Consumer Media Limited is a member of the Independent Press Standards What drives you? Organisation (www.ipso.co.uk) and endeavours to respond to and resolve your don’t give away anything too easily. They challenge me concerns quickly. Our Editorial Complaints Policy (including full details of how to Being my own hero and realising that I am contact us about editorial complaints and IPSO’s contact details) can be found at to think for myself, to come to my own conclusions, and www.bauermediacomplaints.co.uk. Our email address for editorial complaints reaching goals that once seemed unattainable. covered by the Editorial Complaints Policy is [email protected]. to learn first-hand. After all, every day is a school day. I cannot fault any of my colleagues, as they are all What is your favourite app? brilliant techs and truly great teachers. They always Either the Frankie & Benny’s app or Instagram make time to help me if they see me contemplating over How do you relax? something too long, they are always willing to talk me I am a bit of a film nerd and appreciate movies through something that has me puzzled, and offer up so of all genres. many pearls of wisdom to make my job so much easier.
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