Automotive Retail
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Franchised Dealer Offer your booking20% with code OFF Exclusive‘DEALER20’ (hurry - limited time offer) AUTOMOTIVE MANAGEMENT www.am-online.com May 2019 £8.00 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 Automotive Retail BROUGHT CONGRESS TO YOU BY MAY 21, 2019. RICOH ARENA, COVENTRY www.amretailcongress.co.uk Franchised Dealer Offer your booking20% with code OFF Exclusive‘DEALER20’ Exclusive (hurry - limited time offer) Franchised Dealer Offer 20%(hurry - limitedOFF time offer) Automotive Retail Automotive Retail your booking with code ‘DEALER20’ BROUGHT BROUGHT CONGRESS TO YOU BY CONGRESS TO YOU BY 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 Sponsored by MAY 21, 2019. RICOH ARENA, COVENTRY www.amretailcongress.co.uk adRocket 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 am-online.com MAY 2019 3 FP_AM_3876883id3874389.pdf 04.04.2019 14:55 adRocket 30 CONTENTS Batchelors Motor Group up front insight 06 Brexit: Survey results 30 Face to face: 35 10 minutes with… 38 Brand values: Batchelors Ian Plummer, FCA Group 08 Brexit: The impact on 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 am-online.com may 2019 5 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).