AM - Automotive Management magazine February 2015 preview

www.am-online.com February 2015 £8.00

A M AWA R D S 2 015 / P 2 0

AUTOMOTIVE MANAGEMENT

This year’s shortlist for the Oscars of auto retail

AFTER THE BOOM With new car sales predicted to plateau, are your dealerships prepared to explore every avenue for profit?

HONDA / P25

FA C E T O FA C E / P 3 0

COST CONTROL / P4 8

Carmaker plans to double dealers’ profits in three years

Meridian Motor Group MD on why it won’t grow too big too fast

How to keep your operating costs on track in 2015

WELCOME

am-online.com

am@bauermedia.co.uk

@amchatter

am-online.com/linkedin

facebook.com/automotivemanagementUK

OUR EXPERT CONTRIBUTORS

Why profitability, not growth, is key in 2015

W

ill franchised dealers enjoy a repeat this year of the sales successes seen in 2014? Last year’s UK new car market has been hailed as the fourth-strongest on record – no matter whether genuine sales or pre-registrations – and the SMMT forecasts a little more growth to come yet.

However, the glamour of success in car sales does not automatically translate to the same in dealer KPIs – our new-look Market Intelligence section on page 15 shows there’s still a long way to go for many in motor retail. One business that accepts this fact is Meridian Motor Group. It has expanded rapidly within 18 months, but in our face to face interview on page 30 its managing director, Mark Robinson, sets out his ambitions to improve what he has rather than expand further.

Another company facing quite a climb is Honda UK. After years of problematic trading, its retail network’s returns are well behind the curve.

The Japanese brand’s UK head of cars, Leon Brannan, maps out on page 25 how this will change in the medium term.

It should be welcome news for dealers. The impression gained from our poll (page 38) is that they believe new car profits will come under pressure in 2015. It is no coincidence that we look at new car options earnings on page 41, and we’re pleased to share advice gathered from experts on controlling costs in our feature on p48.

Great performance is possible. With the 2015 AM Awards less than a month away, we reveal the shortlisted finalists on page 20.

Rupert Pontin is head of valuations at Glass’s.

With more than 29 years’ experience in the motor trade, he has worked for companies such as BCA and Car Shop, as well as running his own successful independent used car business.

In this issue (p28), he looks at how the general election and post-PCP residual values will dictate the strength of the 2015 used car market.

Prof Jim Saker As director of the Centre of Automotive Management at Loughborough University’s Business School, Saker is a key figure behind the drive for management recognition and skills in the motor retail sector.

This month (p36), he says dealers need a plan for PCP returns, handling potentially disaffected customers and falling used car prices.

The editorial team Email: am@bauermedia.co.uk Website: www.am-online.com Twitter: @amchatter LinkedIn: am-online.com/linkedin

AM Awar ds 2015 b ook your tic today at kets am-award s.co.uk

Jeremy Bennett Editor

Tim Rose Managing editor

Danielle Bagnall Senior reporter

February 19 2015 am-online.com February 2015 5

In this issue February 2015 48

FACE TO FACE MERIDIAN MOTOR GROUP MD MARK ROBINSON

Your news

9

News digest This month’s round-up includes Volvo’s plan to assign a personal technician to every new car buyer; Audi opens a ‘pop-up’ store; Peter Jones joins the Vertu board; and the launch of a new, independent garage co-operative network.

Market intelligence

15

17

New car registrations Our new-look section analyses the emerging trends in new car registrations. This month, we identify the ‘Magnificent Seven’ brands that account for almost two thirds of all registration growth in the 2014 UK new car market.

Dealer profitability The average dealer posted a loss of just under £10,000 in November, more than £5,000 worse than the loss a year earlier.

6 February 2015 am-online.com

19

COST MANAGEMENT KEEP YOUR SPENDING ON TRACK IN 2015

30

Used cars Surplus ex-fleet stock led to a drop in used car values in December.

28

AM Awards 2015

20

AM Awards shortlist All the nominees from motor retail’s most prestigious awards ceremony.

30

Why Vantage aims to be the best, not the biggest

36

View from the business school

How Honda plans to double its dealers’ profits Honda’s three-year strategy, five-year warranties and six product launches in 2015 are part of the Japanese manufacturer’s plans to reverse its UK sales slump.

Glass’s Rupert Pontin on how the General Election, austerity measures and interest rate rises will affect used car sales in 2015.

Insight

Analysis

25

Forecasting the used car market for 2015

38

Managing director Mark Robinson explains Meridian Motor Group’s rapid recent growth and how he and his staff will unite the business under the Vantage brand.

Dealers need to plan for PCP returns and falling used car prices, writes Prof Jim Saker.

AM Poll

Almost three-quarters of franchised dealers believe that new car profits will decrease in 2015.

For the latest motor retail industry news, visit am-online.com Sign up to get AM news daily by email: am-online.com/newsletter

DEALERS AND SUPPLIERS IN THIS ISSUE: APC.......................................................................48 Aprite ...................................................................11 ASE .......................................................................17 Audi.........................................................................9 Bauer Millett........................................................9

AM AWARDS 2015 THIS YEAR’S SHORTLIST

20

BCA.......................................................................19 BCF Wessex ......................................................49 CAP.......................................................................42 FLA .......................................................................15 Glass’s..................................................................28 Grant Thornton.................................................50 Honda............................................................11, 25 Hyundai ...............................................................41

54

Infiniti......................................................................9 JCT600.................................................................11

HYUNDAI TAKES ON THE BIG BOYS WITH THE i20

John Banks Motor Group..............................12 John Clark Motor Group .................................9 JP Arthur & Sons ............................................11 Lookers ...............................................................11

41 48

Is this the end of the optional extra upsell?

Manufacturers are split on whether factory add-ons are the best way for dealers to boost profit.

61

How to keep your costs under control in 2015

From property and tax to vehicle transport and marketing, what are the ways to cut costs in 2015?

62

Showroom

54 56 58

Hyundai i20

Hyundai is aiming to chip away at the Ford Fiesta’s dominance with a design-focused supermini.

Audi A1

The UK is the world’s biggest market for Audi’s smallest hatch, which has become more efficient after mid-life revisions.

Mazda3 We look at how the Skyactiv range

of new engines has helped to transform Mazda’s fortunes in the UK.

Manheim.............................................................19

Seat Ibiza

Michael Edwards .............................................42

Mazda...................................................................11 Meridian Motor Group....................................30

Selling the virtues of this Ibiza’s clever active cylinder technology engine should come with caution. We’ve found its alter ego.

Mitsubishi ...........................................................12

Volkswagen Golf

Nissan..................................................................11

The Golf has proven itself as the greatest all-rounder family car in the market. But does that come at the expense of thrills?

Motorpoint............................................................9 Movex...................................................................49

Perrys Motor Sales.........................................11 Rapleys................................................................48 Škoda .....................................................................9 SMMT...................................................................15 Stoneacre .............................................................9

Coming soon

66

In March’s issue – published February 27

All the winners from the 2015 AM Awards; Face to face with Glyn Hopkin managing director Fraser Cohen; how much does carmakers’ marketing matter; and first drives of the Ford Mondeo and Volkswagen Passat.

Sturgess Group ................................................41 Suzuki ..................................................................42 Swansway ...................................................12, 42 TC Harrison .......................................................11 TrustFord............................................................11 Unity Automotive..............................................12 Vauxhall...............................................................42 Vertu Motors .....................................................11 Volvo .......................................................................9

am-online.com February 2015 7

NEWS DIGEST

T H E N E W S YO U C A N ’ T A F F O R D T O H AV E M I S SE D

11

F O R D A I L Y N E W S , V I S I T: w w w.am-online.com T O g E T A M ’ S F R E E D A I L Y N E W S L E T T E R , V I S I T: w w w.am-online.com/newsletter FOLLOW AM ON TWITTER: @amchatter

Vertu

17

Peter Jones has joined the board of Vertu Motors as nonexecutive chairman.

V O LV O

Volvo to assign a personal technician to every buyer Volvo Cars UK is to trial assigning every buyer a personal technician to assist them throughout their ownership.

Designed to improve customer service, the process will be rolled out across Volvo’s dealer network this year.

As part of the manufacturer’s Volvo Retail Experience (VRE) plans to improve the overall buying experience, two

technicians will work on each vehicle to improve delivery speed.

Volvo has also confirmed it will roll out sales of its full model range online, following the success of its XC90 trial last year. Industry analysts at IHS Automotive questioned the lack of tangibility in selling through internet channels, saying that many customers would be unlikely to want to buy a vehicle without seeing it in the flesh first.

Audi has opened its first ‘pop-up’ store at London’s Westfield Stratford City shopping centre.

The store, open until February 8, will showcase the A3 Sportback E-tron plug-in hybrid electric car to shoppers as it also enters Audi showrooms nationally.

Visitors to the pop-up shop can experience aspects of car and can go on a virtual test drive using Oculus Rift headsets.

John Clark Motor group is to invest £9 million in a flagship Audi dealership in Aberdeen.

It will be the first of the brand’s ‘terminal’-style outlets in Scotland, and at 59,860sq ft, the site will be almost double the size of the current Aberdeen Audi centre, becoming the group’s largest standalone dealership.

The showroom will accommodate up to 20 cars and the service workshop will have capacity for up to 36 cars and access via a fully-enclosed drive-through service reception, another first for Scotland.

A second used car showroom and sales area will also be built. Completion of the new dealership is expected towards the end of 2015.

The average dealer lost just under £10,000 in November.

KPIs now appear in our new Market Intelligence section: p17

IN BRIEF ŠKODA The Škoda Fabia has won the title of Car of the Year 2015 at this year’s What Car? Awards.

The Škoda Fabia 1.2-litre TSI 89bhp SE model beat tough competition from 25 other vehicles that made the shortlist.

The Czech model also won the Small Car category, for both space and practicality.

BAUER MILLETT Manchester car dealer Bauer Millett has ceased trading, with the loss of about 20 jobs.

The company, which traded in a showroom housed within listed viaduct arches in the centre of the city, was the UK’s only remaining Cadillac dealership after a failed attempt by General Motors to launch the US car brand in the UK last decade.

Bauer Millett also held franchises for Chrysler Jeep, Alfa Romeo and Abarth.

AUDI

JOHN CLARK MOTOR gROUP

Dealer profitability

MOTORPOINT

STONEACRE

Stoneacre Motor group has acquired Staffordshirebased dealer Randles Motor group, gaining two Peugeot sites and a Suzuki dealership.

Randles’ latest submitted turnover (2013) was £30.6 million and it sold about 4,000 new and used cars in 2013 from its sites in Stafford and Stoke. This deal will boost revenue at Stoneacre, which had a turnover of £395.1m in 2013.

Already one of the biggest Suzuki dealers in Europe, Stoneacre will operate eight of the Japanese manufacturer’s 143 sites in the UK after the acquisition of Randles’ Stoke dealership.

Meanwhile, Stoneacre’s Peugeot sites will grow by two, with Randles’ Stafford and Stoke showrooms joining Stoneacre’s existing three. The deal also includes a used car/Great Wall franchised site in Stafford. Each of the sites will be rebranded in 2015.

Motorpoint has opened its eighth branch in Widnes, Cheshire. The car supermarket group spent more than £1 million refurbishing the sixacre former Motor Nation car dealership, situated next to the A557, into its latest site.

INFINITI Infiniti has opened sites at Westfield London and Westfield Stratford City, designed to be semi-permanent structures with cars on display and a range of cars standing by for test drives.

Infiniti vice-president for Europe, Middle East and Africa, François goupil de Bouillé, said: “The opening of the Infiniti stores provides us with a further great opportunity to get close to our customers.”

am-online.com February 2015 9

NEWS DIGEST HONDA

Honda UK says it is gearing up its dealers for growth after seven years of stagnation and decline.

The Japanese brand has six car launches planned for 2015, including a HR-V B-segment crossover in the summer and the NSX supercar.

The product offensive means the end of a very difficult period for Honda dealers, who have seen the brand’s market share halve from its 2007 peak of 4.4%.

In the 2014 summer NFDA Dealer Attitude Survey, Honda was ranked bottom for franchise value.

Phil Crossman, managing director of Honda UK, (pictured) said: “We’ve had a bleak few years. It’s been tough. There’s a great affection in the network for Honda, but there’s a frustration about our local product line-up, and that will be addressed now.”

■ How Honda plans to double its dealer network’s profits: Analysis, p25

T O R E A D A M ’ S D A I L Y N E W S L E T T E R , V I S I T: w w w . a m - o n l i n e . c o m / n e w s l e t t e r

TC HARRISON

TC Harrison has acquired Rylatt Ford in Spalding, Lincolnshire, bringing the group’s total Ford dealerships to seven.

Rylatt, which continues to operate a Citroën dealership in Spalding, had re-established the Ford brand in the local area over the past five years.

The acquisition builds on TC Harrison’s presence in the East of England, where it already has dealerships in Huntington, Peterborough, St Neots and Stamford. It also operates dealerships covering Derbyshire and Staffordshire.

With an annual group turnover of more than £240 million, TC Harrison employs about 360 people in its Ford division and a further 200 working at its JCB depots and leasing division in Yorkshire.

The largest Nissan dealer group in the UK, West Way Nissan, has expanded its reach in the North West of England by opening a new site in Altrincham, acquired from Vertu Motors.

The new premises, formerly operated under the Bristol Street name on Manchester Road, means that West Way will have five sites in the North West of England. West Way Nissan is the trading brand of Aprite, the Nissan-owned AM100 retail group.

JP ARTHUR & SONS Arthurs Vauxhall has bought the Dickens Peugeot dealership in Wrexham.

The new dealership will trade as Arthurs of Wrexham and extends the company’s geographical coverage and franchise base from its existing Vauxhall dealerships in Oswestry and Newtown.

Nigel Williams, Arthurs’ managing director, said: “We are confident this will be a good fit with our existing business.”

11 February 2015 am-online.com

DARREN ARDRON Perrys Motor Sales has announced the appointment of Darren Ardron as managing director. He replaces Ray Sommerville, who has chosen to retire on June 30.

Ardron has held numerous senior positions within the group since 1988, including general manager and regional director.

STEVE HOOD TrustFord has appointed Steve Hood as chairman and chief executive.

He succeeds Stuart Kerr, who has left the business to “pursue opportunities outside the group”. Hood was appointed chief operating officer in November and was previously the strategy director at the dealer group.

PETER JONES

LOOKERS W E S T WAY N I S S A N

PEOPLE NEWS

Lookers has opened its new £4 million Ford superstore in Chelmsford, Essex.

Designed in line with Ford’s global brand strategy, the site on Argyll Road has created 85 jobs and is the first of three nationwide Ford superstores the group has planned for 2015. Two more are scheduled to open, in Sheffield and Colchester, before the end of this year.

Lookers has also announced plans to create a new, purpose-built Ford Transit Centre at its site on Robjohns Road, Chelmsford, in 2015, which will focus on showcasing the new Ford Commercial Vehicle range.

MAZDA

Mazda’s 127 dealer partners are to face their busiest year in 2015 and need to make sure that they are fully prepared to take advantage, according to Mazda UK managing director Jeremy Thomson.

Dealer profitability improved throughout 2014, said Thomson, adding “those who get it right in 2015 will be even better rewarded”.

“We said we would deliver 20% sales growth in 2014 and we have. For 2015, we’re going to see sales grow by another 10%, taking us to around 45,000 sales and a market share of 1.8% in what is predicted to be a relatively flat market.”

With three new models (Mazda2, CX-3 crossover SUV and MX-5) and two major upgrades (Mazda6 and the CX-5) launched in a little over six months, dealers can expect to be busier than ever and need to make sure they have the resources they need, he said.

Peter Jones has joined the board of Vertu Motors as non-executive chairman, following the retirement of Paul Williams.

Williams had served for seven years as Vertu’s chairman, prior to which he headed Bristol Street Motors, which Vertu acquired.

TONY LEWIS Nissan has appointed Tony Lewis as its UK sales director.

Lewis, currently brand director at Jardine Motors Group, begins his new role on February 4. He has held a number of previous roles within the Nissan Motor Group, including UK corporate sales director and Infiniti regional director of Northern Europe.

K AT I E S A U N D E R S JCT600 has appointed Katie Saunders as its new HR director.

Saunders was formerly head of talent and leadership development for the group.

NEWS DIGEST

RE AD AM IN YOUR INBOx: am-online.com/newsletter

UNIT Y AUTOMOTIVE

Unity Automotive has taken on its first Alfa Romeo franchise with the acquisition of the Motor Village site in Kidlington, Oxfordshire.

It brings the total number of sites operated by Unity to five, alongside Coventry, Peterborough, Tredington and Leicester. Unity’s franchise portfolio now includes Subaru, Mitsubishi, SsangYong, Chrysler, Jeep, Great Wall, Isuzu and Alfa Romeo. The deal was completed on Christmas Eve. The workforce now numbers more than 100.

S WA N S WAY

Stafford Land Rover has opened a state-of-the-art £6 million dealership, following investment from the Swansway group.

The dealership, one of the UK’s first Land Rover concept showrooms, is situated just off junction 14 of the M6. It is the biggest ever investment made by the group.

Dealer principal at the site, Darren Poole, said: “The new site is truly state of the art and is set to deliver a customer experience like never before with total brand consistency alongside exceptional customer service and cutting-edge technology.”

MITSUBISHI MOTORS

Mitsubishi has introduced a five-year warranty across all of its models.

From January 1, all cars and commercial vehicles will come with the new warranty package as standard.

Lance Bradley, Mitsubishi’s UK managing director, said: “The move to a five-year warranty is a reflection of Mitsubishi’s confidence in the unrivalled quality and reliability of our product.”

JOHN BANKS

John Banks has announced that it is the new partner in Cambridge for Renault and Dacia.

The acquisition from Richard West of ‘Wests’ will see the Swann Road dealership knocked down to make way for a new state-of-the-art showroom.

It will temporarily trade from the sales facility at 217 Newmarket Road for 12 weeks while the build is completed. The site at Newmarket Road is planned for demolition in the near future. Existing staff will remain at the sites.

The group already manages Honda and Suzuki franchises.

I N D E P E N D E N T g A R A g E C O O P E R AT I V E

AM PROMOTION

PUTTinG The RiGhT TeAM ToGeTheR

By Neil Addley, MD of Trusted Dealers, the advertising website owned by dealers and the NFDA

The combination of new budgets and people reflecting on their careers over the Christmas period makes January one of the biggest months for recruitment in the motor trade.

In an increasingly competitive and changing environment, I don’t believe that there are many who would argue about the need to recruit the right people. But where do you find the best solution?

Local press has had its day and recruitment agents can be effective, but also expensive.

What about online jobs boards, when there are so many to choose from and costs can mount up? Also, if you advertise on more than one, how do you keep track of applicants?

“Local press has had its day and recruitment agents can be effective, but also expensive” That’s why the NFDA and Trusted Dealers have teamed up with online recruitment specialists CVWOW to create an unrivalled online jobs board package that brings together most of the big names in online recruitment at a fraction of the cost of buying them individually.

From as little as £149, jobs can be advertised on Trusted Dealers, Monster, Total Jobs and at a significant discount to CVWOW’s rate card, and our connect package also includes Jobsite, Reed, Motoring Jobs and many other motoring specific websites.

In addition, the class-leading applicant tracking system (ATS) enables you to manage all these applications in one place and will even send out rejection emails on your behalf (any applicant could also be a customer).

If you’re interested in building your team for a prosperous New Year, drop us a line at neil@trusteddealers.co.uk or call 01423 506 272.

A new, independent garage co-operative network has been launched, promising “a unique approach to vehicle maintenance for fleet and retail customers”.

The national network, called the Independent Garage Cooperative (IGC), unites more than 120 independent garages, but 80 more are expected by summer.

The co-ownership approach, which has been endorsed by the Institute of the Motor Industry (IMI), is being led by IGC chief executive Steve Wadlow, operations director Dave Poole, and national network manager Phil Todd

12 February 2015 am-online.com

For more information, call 01423 506272 or email neil@trusteddealers.co.uk

MARKET INTELLIGENCE 16

Sector analysis

Just seven brands were responsible for more than half of registration growth in 2014’s UK new car market.

17

Dealer profitability

The average dealer posted a loss of just under £10,000 in November, more than £5,000 worse than the loss a year earlier.

THE NEWS IN DEPTH

19

Used cars

Sponsored by

A drop in values in December suggested dealers had required less stock than the fleet sector was willing to push to market.

Welcome to AM’s new-look market intelligence section Month to month, we analyse the latest data to track new and used car retail trends U K N E W C A R R E G I S T R AT I O N S ( R O L L I N G Y E A R T O TA L ) – 2 0 0 8 -2 014 W I T H 2 015 F O R E C A S T The new car market in 2014, at 2,476,435 units, was the most successful for 10 years and the fourth largest result since the SMMT’s records began. Only 2002, 2003 and 2004 saw more cars registered.

The 2014 market grew 9.3% over 2013. Every month in 2014 saw an increase, with December’s 8.7% rise the 34th consecutive month of growth.

The SMMT’s forecast for 2015 is a 2.49m market, a 1-2% rise on 2014.

Tim Smith, head of motor finance, North & major groups, at Black Horse, said: “The sharp drop in oil prices since June last year has played a positive role in the manufacturing and production of affordable new cars alongside a low interest rate environment for consumers.”

The UK remains the second largest EU market (behind Germany and ahead of France, Italy and Spain), and recorded the second-largest growth of these top five EU markets.

F I N A N C E S TAT S

R E G I S T R AT I O N S B Y M A R K E T S E G M E N T Private 1,179,499

2014

2013

Fleet 1,178,416

Private 1,074,622

0

500,000

1,000,000

Fleet 1,084,279

1,500,000

2,000,000

Business 118,520

Business 105,836

2,500,000

N O V E M B E R M O T O R F I N A N C E M A R K E T: N E W C A R S New cars bought on finance by businesses through dealerships Nov-14 Change on 3 months to previous year Nov 2014 Value of advances (£m) 965 10% 4,437 Number of cars 59,983 7% 273,986 New cars bought on finance by businesses through dealerships Number of cars 33,091 0% 122,741

Change on previous year 15% 11%

12 months to Nov 2014 13,963 892,737

Change on previous year 18% 13%

18%

455,489

14%

Showroom loans provided by Finance & Leasing Association members for new retail cars grew 7% in November year-on-year. The market in the year to November rose 13%, with dealer finance maintaining a 75.9% market share.

Geraldine Kilkelly, head of research and chief economist at the FLA, said personal contract purchase (PCP) was now a popular choice for many consumers, but added: “Many customers still want to own their car outright and we have also seen growth in hire purchase over the last year.”

Samantha Cripps, head of sales development at Alphera UK, says the growth in PCPs means this year could be “a game changer” for dealers and finance providers, partly because of new FCA regulations. She expects new car registrations to peak in 2015.

am-online.com February 2015 15

MARKET INTELLIGENCE THE MAGNIFICENT SE VEN Seven brands were responsible for more than half of registration growth in 2014’s UK new car market, which finished 211,698 cars higher than in 2013.

The crown for the biggest volume driver was narrowly won by Volkswagen, with 20,743 more cars registered than in 2013. The largest contributors to this were the Polo and Golf, although the Tiguan and outgoing Passat also played a part, particularly in fleet and business markets.

Nissan was close on Volkswagen’s tail, with 20,161 more registrations, half of which were accounted for by the Sunderland-built new Note compact MPV, which pushed hard into the fleet sector. The new X-Trail, Micra and electric-powered Leaf also fuelled its growth in the private market.

James Wright, Nissan Motor GB managing director, said: “Key to Nissan’s success in 2014 is the onslaught of new and updated products launched in the last year and I am immensely proud of the hard work and dedication displayed by the Nissan team in the UK.” The final podium place was taken by Renault, which increased its year-on-year registrations by 20,161. The French brand achieved three times as many Captur compact SUV registrations last year than in 2013, when it was introduced mid-year.

Others 42%

Volkswagen 10%

WHICH UK CAR BRANDS GREW NEW CAR REGISTRATIONS MOST IN 2014?

Nissan 10%

BMW 6% Renault 10% Ford 7%

Mercedes-Benz 7%

Audi 8%

FINANCE OFFERS Volkswagen led the new car volume growth in 2014 and its 2015 Q1 new car finance offers suggest it has no intention of applying the brakes. Appealing to first-time new car buyers, it is applying a £1,000 deposit contribution to the Polo supermini, which allows buyers to get the keys to a new car for £1,283 of their own money and £129 per month thereafter. For those with a small family, Volkswagen is making the Golf SV 1.2TSI accessible for £4,118 deposit (plus a £750 manufacturer contribution) and £235 per month.

The full list of manufacturers’ finance offers can be found at www.am-online.com/offers

16 February 2015 am-online.com

Top finance offers for retail buyers

Model

Finance type

For a searchable list of manufacturers’ finance offers, go to www.am-online.com/offers

Deposit

Term

Audi A1 Sportback 1.4 TFSI PCP * £3,193.24 36 months A3 saloon 1.4 TFSI PCP * £3,540.00 36 months Q3 2.0 TDI quattro PCP * £6,470.75 37 months Annual mileage cap 10,000. Excess per mile: * 7.2p Ford Ka Zetec 1.2 3dr Personal lease * £810 36 months Focus Titanium 1.0 Ecoboost Personal lease ** £4,122 36 months Kuga Titanium 2.0 TDCI fwd Personal lease *** £5,478 36 months Galaxy Zetec 2.0 TDCI Personal lease **** £7,656 36 months Annual mileage cap 9,000. Excess per mile: * 5.71p ** 4.93p *** 8.51p **** 8.81p Vauxhall Corsa 1.2 3dr Excite PCP £2,751 * 24 months Adam Jam 1.2 PCP £2,295 ** 24 months Mokka Exclusiv 1.6 PCP £4,106 *** 36 months Insignia Limited Edition 1.8 HP £5,549 60 months Deposit contributions: * £500 ** £1,340 *** £713 Volkswagen Polo 1.0 S 3dr PCP † £2,283.50 * 36 months Golf 2.0 TSI GTI 3dr PCP †† £7,126.52 ** 36 months Passat 1.6 TDI S PCP †† £5,155.61 36 months Touran S 1.2 PCP † £5,862.65 36 months Deposit contributions: * £1,000 ** £750. Annual mileage cap 10,000: excess per mile †4.4p †† 7.2p

Monthly Final payment payment

APR

Offer ends

£219 £309 £349

£8,688.47 £12,984.60 £19,496.76

7.4% 7.4% 7.2%

31/03/15 31/03/15 31/03/15

£135 £229 £249 £319

n/a n/a n/a n/a

n/a n/a n/a n/a

31/03/15 31/03/15 31/03/15 31/03/15

£139 £99 £199 £259

£6,251 £6,225 £7,150 n/a

2.9% 2.9% 2.9% 0%

01/04/15 01/04/15 01/04/15 01/04/15

£129 £275 £249 £279

£4,826.11 £12,288.35 £8,993.70 £6,311.84

7.7% 7.2% 6.1% 7.4%

31/03/15 31/03/15 31/03/15 31/03/15

Sponsored by

Volkswagen Polo Contributed to VW’s 20,743-unit increase in 2014 registrations

ADVERTISEMENT PROMOTION

BLACK HORSE COMMENT

By Chris Sutton, managing director, Black Horse

Nissan NOTE The Sunderland-built compact MPV pushed hard into the fleet sector in 2014.

Renault Captur Three times as many registrations in 2014 than the year before.

DEALER KPIs Key ratio

Net profit as % sales Overhead absorption Used: New sales Expenses as % gross Sales per salesman Used vehicle stockturn (days) Return on used car investment Overall Labour efficiency Service gross profit % on labour Service expenses as % gross Hours per retail job card Parts gross profit Parts expenses as % growth Parts stockturn

Rolling 12 months Nov 2014 1.42% 55.4% 0.86:1 62.4% 198 54.7 80.6% 82.2% 75.7% 58.0% 1.64 22.2% 44.7% 8.09

Rolling 12 months Nov 2013 1.38% 56.2% 0.91:1 62.8% 198 56.4 79.2% 81.0% 75.7% 57.0% 1.64 22.4% 44.8% 7.76

Benchmark

3.0% 80% 1.5:1 50% 150 45 100% 100% 75% 40% 2.5 22% 40% 8.0

The recurring theme for 2014 has been plenty of sales, with exceptional profits made in quarter-end months as dealers recognise bonuses. This continued in November, with the average dealer posting a loss of just under £10,000, more than £5,000 worse than the loss a year earlier. While expected, this shows the extent to which dealers are experiencing increased peaks and troughs. However, all is definitely not doom and gloom, as dealers showed turnover increasing 13% in the month.

Given sales levels in both the final quarter to date and the overall year, dealers will almost certainly have closed out the year with another record performance, beating last year’s return on sales of 1.47%.

The car sales industry entered the New Year in a position of strength, with monthly sales continuing to grow as 2014 drew to a close. Experts suggest the sector has plenty to offer in the coming 12 months, though the growth rate may slow.

The growth in sales has been supported by the growing use of vehicle finance, as consumers increasingly recognise the convenience of point-of-sale finance. In light of the FCA changes introduced last year, this has placed dealers, on behalf of motor finance providers, under increasing scrutiny to ensure the agreements they offer are affordable and sustainable. That is why, at Black Horse, we recently enhanced our assessment criteria to place even greater emphasis on an applicant’s ability to afford repayments both at the time of entering into the agreement and throughout the loan period, rather than basing a decision purely on a historic credit rating.

Despite evidence from the regulator that this is an area of increasing focus, not all finance providers appear to have changed their assessment approach. Some still rely heavily on credit data that recognises the applicant’s previous track record with finance, but does not assess their ability to afford regular payments over an extended term.

While we believe past behaviour offers useful information, it needs to be enhanced by additional figures not available via credit reports. We therefore feel that it is only by also assessing a customer’s regular income and outgoings, such as their rental and or mortgage expenditure, that a fully robust assessment can be made of their ability to afford repayments in the long term.

While it is good news across the industry that arrears levels are low, we must all maintain a focus on providing customers with agreements they can comfortably repay, even if their financial circumstances change. We cannot allow their excitement to purchase a vehicle spotted in the showroom to distract us from this responsibility.

This is why we are surprised and somewhat disappointed in what appears to be an inconsistent approach to this issue across the industry. Some lenders appear to be doing nothing different and continue to advance money based purely on credit bureau data and the value of their security, obtaining no specific financial information from the customer. We would urge those that have not made changes to their operating model to reconsider their approach, as by making these key changes they will earn the trust and loyalty of their customers and that can only be a good thing for the industry overall.

am-online.com February 2015 17

MARkeT INTeLLIGeNCe 10-year market trends available: www.am-online.com/ami

n e w c a r r e g i s t r at i o n s

1 2 3 4 5 6 7 8 9 10

BRAND MG Maserati SsangYong Infiniti Jeep Mitsubishi Renault Dacia Lexus Volvo

YTD (%) 361.51 274.29 132.93 93.26 75.37 74.76 43.66 39.17 28.38 25.71

r i ser s & fa l l er s

that renault and sister-brand Dacia feature in the top 10 rising brands of 2014 will be heartening for the dealer network after the french brand’s fairly torrid post-recession trading. together, they put 26,877 more cars on the road in 2014 than in 2013, taking a 3.6% share of the market, a gain of almost a whole percentage point at the expense of their fellow french brands, who’ve both lost market share.

10 9 8 7 6 5 4 3 2 1

BRAND Peugeot Alfa Romeo Honda Aston Martin Lotus Smart Chrysler Proton Chevrolet Perodua

YTD (%) -1.77 -2.88 -3.80 -6.70 -8.20 -18.29 -21.19 -45.00 -76.24 -85.92

18 February 2015 am-online.com

Marque

2014

Vauxhall Ford Volkswagen BMW Nissan Audi Mercedes-Benz Mini Toyota Peugeot Citroën Renault Škoda Hyundai Fiat Kia Seat Land Rover Honda Volvo Suzuki Mazda Dacia Mitsubishi Jaguar Porsche Lexus Alfa Romeo Jeep Subaru Chrysler MG Abarth Bentley Maserati Infiniti SsangYong Aston Martin Smart Proton Lotus Chevrolet Mia Perodua Saab Other British Other Imports Total

23,162 20,509 14,475 12,445 8,762 8,013 7,774 7,172 5,687 5,509 5,182 5,162 4,615 4,578 3,996 3,907 3,892 3,652 3,460 2,723 2,053 1,715 1,503 1,362 1,356 813 709 329 320 229 149 128 126 108 106 79 76 73 13 10 5 0 0 0 0 36 225 166,198

December % market 2013 share

% market % share change

2014

13.94 12.34 8.71 7.49 5.27 4.82 4.68 4.32 3.42 3.31 3.12 3.11 2.78 2.75 2.40 2.35 2.34 2.20 2.08 1.64 1.24 1.03 0.90 0.82 0.82 0.49 0.43 0.20 0.19 0.14 0.09 0.08 0.08 0.06 0.06 0.05 0.05 0.04 0.01 0.01 0.00 0.00 0.00 0.00 0.00 0.02 0.14

13.93 12.75 8.98 7.50 4.60 4.87 4.33 2.62 3.30 4.08 2.53 3.51 3.46 3.11 2.66 2.48 2.36 1.97 2.20 1.65 1.48 0.94 1.34 0.50 0.65 0.51 0.41 0.20 0.12 0.14 0.03 0.08 0.04 0.05 0.01 0.01 0.02 0.05 0.20 0.00 0.04 0.26 0.00 0.00 0.00 0.02 0.01

269,177 326,643 214,828 148,878 138,338 158,987 124,419 53,661 94,012 103,566 83,397 66,334 75,488 81,986 67,162 77,525 53,512 56,200 53,544 41,066 37,395 37,784 23,862 15,805 18,401 9,160 11,572 5,523 3,909 2,793 1,982 2,326 1,642 1,472 1,194 746 1,542 864 4,342 11 235 2,774 5 29 3 774 1,567 2,476,435

21,302 19,496 13,725 11,470 7,040 7,442 6,619 4,011 5,042 6,239 3,875 5,372 5,286 4,757 4,060 3,787 3,606 3,012 3,368 2,528 2,270 1,442 2,047 763 993 777 629 313 190 210 49 120 54 75 16 21 34 78 304 0 63 395 0 1 0 24 13 152,918

8.73 5.20 5.46 8.50 24.46 7.67 17.45 78.81 12.79 -11.70 33.73 -3.91 -12.69 -3.76 -1.58 3.17 7.93 21.25 2.73 7.71 -9.56 18.93 -26.58 78.51 36.56 4.63 12.72 5.11 68.42 9.05 204.08 6.67 133.33 44.00 562.50 276.19 123.53 -6.41 -95.72 0.00 -92.06 -100.00 0.00 -100.00 0.00 50.00 1,630.77 8.68

Year-to-date % market 2013 share

% market share

% change

10.87 13.19 8.67 6.01 5.59 6.42 5.02 2.17 3.80 4.18 3.37 2.68 3.05 3.31 2.71 3.13 2.16 2.27 2.16 1.66 1.51 1.53 0.96 0.64 0.74 0.37 0.47 0.22 0.16 0.11 0.08 0.09 0.07 0.06 0.05 0.03 0.06 0.03 0.18 0.00 0.01 0.11 0.00 0.00 0.00 0.03 0.06

11.46 13.73 8.57 5.99 5.21 6.27 4.83 2.29 3.91 4.66 3.46 2.04 2.92 3.40 2.66 3.18 2.00 2.42 2.46 1.44 1.46 1.38 0.76 0.40 0.72 0.36 0.40 0.25 0.10 0.10 0.11 0.02 0.06 0.05 0.01 0.02 0.03 0.04 0.23 0.00 0.01 0.52 0.00 0.01 0.00 0.03 0.04

3.75 5.08 10.69 9.81 17.27 11.93 13.67 3.33 6.05 -1.77 6.43 43.66 14.24 6.59 11.57 7.54 18.10 2.74 -3.80 25.71 13.02 20.99 39.17 74.76 13.52 10.90 28.38 -2.88 75.37 22.99 -21.19 361.51 21.45 19.58 274.29 93.26 132.93 -6.70 -18.29 -45.00 -8.20 -76.24 0.00 -85.92 0.00 1.98 92.27 9.35

259,444 310,865 194,085 135,583 117,967 142,040 109,456 51,933 88,648 105,435 78,358 46,173 66,081 76,918 60,198 72,090 45,312 54,699 55,660 32,666 33,088 31,228 17,146 9,044 16,210 8,260 9,014 5,687 2,229 2,271 2,515 504 1,352 1,231 319 386 662 926 5,314 20 256 11,676 5 206 3 759 815 2,264,737

Sponsored by

Retail stock acquisition The average selling price of ex-fleet vehicles dropped to £6,693, a monthon-month slump of £255 or 1.3%,

according to Manheim’s Market Analysis for December. The average value was also £102 lower year-on-year.

BCA saw average ex-fleet car value plunge £507 since November. The average figure of £9,126 was £36 down year-on-year, despite lower mileage.

The drop in value suggested dealers had required less stock than the fleet sector was willing to push to market.

However, BCA’s UK operations director, Simon Henstock, suggested the opposite: “December is a short month for trading and both the market sector mix and model mix tend to change quite significantly.

Fleet and lease stock is typically in more limited supply as the year-end approaches, while dealers continue to sell part-exchange vehicles as part of their ongoing retail activity.

“The early days of trading in 2015 have been exceptionally busy and with the new plate only weeks away we are entering one of the busiest periods for the motor trade. Sourcing and securing those best quality retail cars will be critical for professional buyers in the weeks ahead.”

Fleet/leasing Dec 2013 39.60 Dec 2014 39.72 46,940 48,726 £9,162 £9,126 95.84% 94.87%

Part-exchange Dec 2013 88.43 Dec 2014

9218

9572

7791

9448

7376 6964

3857

3842

3830

3797

3906

3162

3129

3209

3216

3285

9411

9593

9445

7273

7260

7135

3982

4048

3973

4065

4032

4059

3016

3077

3125

3130

3162

3162

House prices

+7.1%

73,562 £3,842 £4,113 95.15% 94.34%

Nearly new Dec 2014

The average house price in England and Wales in November 2014 was £176,581, 7.1% higher than in November 2013, according to the Land Registry. However, the average was 0.1% lower than October.

7.01 8,125 £23,075 101.16% Average age (months) Average mileage Average value Sales vs CAP

9533

9126

7045

Mortgages

3%

First-time buyers saw a lending decline in November 2014, with 25,900 first-time buyer loans, down 11% on October, and 3% down on November 2013. There was £3.8 billion advanced to first-time buyers in November, 12% down on October but 6% up on November 2013, said the Council of Mortgage Lenders.

9633

7791

7076

6795

9537

CPI annual inflation, the Government’s target measure, was 0.5% in December 2014, down from 1% in November.

CPIH (inflation including owneroccupiers’ housing costs) was 0.6% in December 2014, down from 1.0% in November.

6948

6693

4136

4188

4113

3390

3395

3383

Unemployment

1.4 ppts

➡

7824

7593

9624

9191

0.5ppts

73,744

Manheim Fleet £ Manheim Part Ex £ BCA Fleet £ BCA Part Ex £

9162

Inflation

89.80

U S E D C A R VA L U E T R E N D S

9301

ECONOMIC I N D I C AT O R S

➡

Trade-in disposal The average value for dealer partexchanges in December fell by £75 or 2% to £4,113, according to BCA, the UK’s largest motor auction group. Yearon-year, December values were ahead by £271. The average age of partexchanges was slightly higher than that of a year previously.

At Manheim’s auction rooms, the average part-exchange value for December was down £12 month-onmonth to £3,383. Year-on-year, the average value was 8% or £254 higher.

“While other areas of retail, particularly the big supermarkets, continue to face challenging times, values in the dealer sector have performed broadly in line with expected seasonal norms. The continued application of knowledge of the marketplace and their customer base by dealers is an essential part of this,” said Daren Wiseman, valuations services manager at Manheim Auctions.

YEAR-ONYEAR

➡

Used values dip ahead of busy plate-change season

The unemployment rate for August to October 2014 was 6%, down from 7.4% for a year earlier, according to the Office for National Statistics.

£ £

12 months to Nov 2014 10,542 1,039,069

Change on previous year 22% 15%

40,894

-30%

£

£

£ Used cars bought on finance through dealerships Nov-14 Change on 3 months to Change on previous year Nov 2014 previous year Value of advances (£m) 806 11% 2,722 17% Number of cars 76,572 5% 260,267 10% Used cars bought on finance by businesses through dealerships Number of cars 2,270 3% 9,341 -18%

£ Debt £ £

£ +£400m

£

Net consumer credit borrowing rose £0.4 billion in November, according to the British Banking Association. It said more demand for personal loans reflected improved household finances and an easier borrowing climate.

am-online.com February 2015 19

AM AWARDS SHORTLIST INNOVATION AWARDS Best Training and Development Programme Hyundai Capital JCT600 Kinghams of Croydon Lifestyle Europe Mercedes-Benz UK (Van Talent) Sponsored By: AutoProtect Best Dealer Website CarShop HR Owen Perrys Motor Sales Best Social Media Campaign Perrys Motor Sales Romford Mazda Sponsored By: Marketing Delivery

THE 2015 SHORTLIST

NEW FOR 2015 Best Use of Television and/or Video Hendy Group Kia Motors – Kia Carens ‘Re-view Mirror’ Perrys Motor Sales Sponsored By: Sky AdSmart Best Manufacturer Digital Initiative Kia Motors – Kia Carens ‘Re-view Mirror’ Toyota – Accessory Selling Tool Volkswagen – Blended Retailing Sponsored By: Autotorq

EXCELLENCE IN BUSINESS

W

ith the judging complete, nearly 80 companies are in the running for the highest accolades in automotive retail.

A panel of five judges, including AM editor Jeremy Bennett and chaired by Christopher Macgowan OBE, made their choices this month from the dealers seeking to be crowned the best in the industry.

Taking a deliberately diverse look at the industry, we are seeking to acknowledge great performance, innovation and a consistent approach that exploits opportunities and tackles problems across more than 20 categories. They range from the cutting-edge – in the four digital categories – to the traditional, among them aftersales, used cars and fleet.

As well as dealers, AM acknowledges the part played by manufacturers in the health of the retail sector in five awards voted for by dealers – new car, used car and franchise of the year as well as manufacturer of the year and digital initiative.

The competition is intense – it guarantees the February 19 ceremony will yet again be a night to remember.

“We are seeking to acknowledge great performance, innovation and a consistent approach that exploits opportunities and tackles problems” 20 February 2015 am-online.com

Excellence in Customer Service Bristol Street Motors Hyundai – Peterlee Knights North Staffordshire Watford Audi Sponsored By: EMaC Most Improved Company of the Year Humphries And Parks Luscombe Mitsubishi Leeds Taunton Audi (Marshall Motor Group) Sponsored By: Jewelultra Diamondbrite Sales Team of the Year (New or Used Cars) Hillington CarStore (Peter Vardy) Humphries And Parks Lincoln Volvo (Stoneacre Motor Group) Sponsored By: Barclays Partner Finance Excellence in Aftersales Liverpool Audi (Jardine Motors Group) Pebley Beach Vic Young (Vic Young South Shields) Sponsored By: Enterprise Rent-A-Car NEW FOR 2015 Service Adviser of the Year Esther Sellers (Swansway Garages) John Sleeman (Vertu Honda) Sponsored By: Rotary Lift

T O B O O K Y O U R A T T E N D A N C E , V I S I T: w w w . a m - a w a r d s . c o . u k

RETAILER AWARDS Best Used Car Performance HR Owen Swansway Chester Peugeot Sponsored By: Autoclenz Best Fleet Operation Holdcroft Group Fleet Jardine Motors Group JCT600 Swansway Garages Sponsored By: ContractHireAndLeasing.com Best Dealership Crewe Seat (Swansway Garages) Milcars Mazda Richmond Hyundai Vic Young (Vic Young South Shields) Sponsored By: The Warranty Group

MANUFACTURER AWARDS Used Car of the Year Audi A1 Audi A3 Ford Fiesta Mercedes-Benz C-Class Sponsored By: Car Care Plan

Car Care Plan An AmTrust Financial Company

New Car of the Year Audi TT Coupé Jaguar F-Type Coupé Kia Soul Mercedes-Benz C-Class Sponsored By: Supagard Franchise of the Year Audi UK Ford UK Kia Motors UK Mercedes-Benz UK

Best Retail Group (up to & including 10 sites) Day’s Motor Group Lifestyle Europe Peoples Best Retail Group (more than 10 sites) Glyn Hopkin John Clark Motor Group Marshall Motor Group Spire Automotive Swansway Garages Sponsored By: Mapfre Abraxas

HEADLINE AWARDS Dealer Principal/General Manager of the Year Adam McCullagh (Mercedes-Benz Birmingham Central) Jane Hargreaves (Wrexham Volkswagen) Robin Luscombe (Luscombe Suzuki & Mitsubishi Leeds) Vic Young (Vic Young South Shields) Digital Initiative of the Year Shortlist is made up of the winners from each digital category Sponsored By: Auto Trader Manufacturer of the Year BMW UK Ford UK Nissan Motor GB Sponsored By: Touchpoint Retailer of the Year Shortlist is made up of the winners from each retail category Sponsored By: Black Horse Business Leader of the Year Chosen by the editor of AM AM Hall of Fame Chosen by the editor of AM

February 19, The ICC, Birmingham am-online.com February 2015 21

AM AWARDS SHORTLIST ORDER OF EVENTS 6.45 p.m

Pre-dinner drinks reception, commences in Hall 4

7.15 p.m

Call for dinner in Hall 3

7.30 p.m

Welcome, presentation of the awards - Part 1, followed by dinner

9.15 p.m

BEN raffle

9.45 p.m

Presentation of the awards - part 2

10.30 p.m

Cabaret

11.00 p.m

Bar & lounge open

1.30 a.m

Bar closes

2.00 a.m

Carriages

DRESS CODE: BLACK TIE/ EVENING DRESS

T O B O O K Y O U R A T T E N D A N C E , V I S I T: w w w . a m - a w a r d s . c o . u k

HOST AND ENTERTAINMENT The 2015 AM Awards will be hosted by Louise Minchin. Minchin presents Breakfast on BBC One, is a guest presenter on Radio 5 Live and a reporter on The One Show.

Before joining Breakfast, she was a news anchor on BBC News and regularly hosted the BBC One O’Clock News. She has also presented sports shows, played a cameo (as herself) in Spooks and managed to get herself Louise Minchin ejected from Hell’s Kitchen – even though she wasn’t a contestant. Louise has fronted Channel Five News and its showbiz show Exclusive. She has also co-presented with John Sopel and John Inverdale, and shares the Sunday Life sofa with Colin Jackson.

To finish the ceremony in style, Russell Kane will entertain our guests.

Kane is a multi-talented writer and performer and has established himself as one of the best comics in the UK. He returned to Edinburgh as a former winner of the Foster’s Edinburgh Comedy Award, this time with three shows including his latest sell-out success – Smallness.

Russell Kane He was recently seen on the small screen hosting the third series of Live at the Electric for BBC3, as well as co-hosting Staying in with Russell & Greg, with Greg James.

He was also part of the presenting team of ITV2’s I’m a Celebrity…Get Me Out Of Here Now! and Big Brother’s Big Mouth for Channel 4. He has also won Celebrity Mastermind, was a finalist in Let’s Dance for Comic Relief and has appeared as a guest on The Graham Norton Show.

■ For further details on the AM Awards 2015, please visit the event website at www.am-awards.co.uk

Welcome to this year’s AM Awards’ sponsors It is now less than one month until more than 20 franchised dealers and car manufacturers will have the honour of standing on the stage of the 2015 AM Awards to receive their coveted trophy.

A unique stage set has been created, a glimpse of which can be seen to the right.

Coverage of the 2015 AM Awards will be in the next issue of AM and at AM-online.

ContractHireAndLeasing.com is sponsoring the Best Fleet Operation award Enterprise Rent-A-Car is sponsoring the Excellence in Aftersales award We’re delighted to receive the support of ContractHireAndLeasing.com and Enterprise Rent-A-Car for these two key award categories at what promises to be an industry highlight of 2015.

For more information on the AM Awards, including the sponsorship packages still available and details of how to book tables, go to www.am-awards.co.uk

22 February 2015 am-online.com

12 February 2015 The NEC, Birmingham, B40 1NT

08.30

11.30

09.30

Alex Rose, marketing director, Whocanfxmycar.com

Aftersales in the digital sphere

Registration & networking

Welcome Jeremy Bennett, editor, AM and Ginny Buckley, conference chair

09.40

Digital retail lessons from the US Chip Perry, non-executive board member, Auto Trader Having established the Auto Trader digital brand in America as president and CEO, Perry will share the lessons learned from US car buyers.

Perry will underline the key US trends which have transformed car buying over the pond and demonstrate how these habits are now emerging in the UK. Offering a fascinating insight into the car buyer of today and tomorrow, Perry will provide advice on tweaking the digital approach from content to metrics to better meet consumer expectations.

10.10

Promotions and compliance – how to harness F&I in the digital world Simon Ryan, managing director, Social Advisors By working with a franchised dealer, Ryan will present real life examples and results to illustrate how dealers can harness F&I in the digital environment. This session will provide dealers with the insight they need to navigate this complex area and stake their claim in an as yet uncrowded social space.

Digital now forms a vital aspect of operating a proftable aftermarket business, yet many dealers have yet to apply the same levels of innovative thinking as they do for new and used car sales. Rose will draw on digital offerings from the insurance and holiday sector to explore ways in which aftersales can improve their own presence in line with consumer expectations.

11.50

Q&A session

12.00

Workshop sessions

13.00

Lunch & networking

14.00

Connecting the car and the customer may sound straightforward and obvious, but most dealers can follow a car literally to the ends of the earth whilst customers slip through their CRM systems. To truly place the customer at the centre of the group’s operations, Harris and his team have taken an holistic approach, here he explores how H.R. Owen has made the car secondary to the customer and provides an insight into how big data drives its digital marketing.

Andrew Brennan, intellectual property and technology lawyer, SGH Martineau The intellectual property and technology team at this leading UK commercial law frm will provide an interactive session which asks is your website legal?

Businesses must ensure their websites comply with a number of different laws, particularly those relating to data protection, direct marketing and consumer rights - failure to comply risks investigation by a regulator or watchdog, followed in some cases by fnancial penalties. The session covers: the minimum legal requirements for all business websites; common mistakes; making sure terms and conditions are appropriate; avoiding copyright infringements; and special website considerations for specifc business sectors.

Refreshments & networking

15.20

Stuart Bluck, head of research & insight and Rakesh Patel, digital sales director, Auto Trader

Targeted TV – taking dealerships onto the small screens and into living rooms (a dealer case study) Mark Busby, new car sales & group marketing director, Hendy Group

Omni-channel marketing – the future of digital retailing

Chris Harris, marketing and customer director, HR Owen

Is your website legal?

Trends, habits and insights of today's digital car-buyer

15.40

The car and the customer – joined up digital marketing (a dealer case study)

Workshop 1

15.00

10.45 11.05

An interactive and informal opportunity for delegates to choose two of the three workshop sessions and focus on specifc areas of interest.

Workshop 2

10.35

Refreshments & networking

Workshops

Workshop sessions (repeated)

The UK’s frst company to trial Sky AdSmart, which allows different adverts to be shown to different households watching the same Sky TV programme according to specifc demographic profles, was Hendy Group. Now a central element of the group’s 2015 marketing plan, Busby will debunk the myth that television is prohibitively expensive and explain how viewers are consuming TV in the digital age and why automotive retailers should seriously consider the medium.

Q&A session

Last chance to book!

Sean Meehan, social media marketing manager, Boots Multi-channel marketing very quickly evolved to become omni-channel marketing to deliver a joined-up and seamless retail experience to the consumer. Meehan draws on all layers of his experience including retail and automotive to explore omni-channel best practice and future trends. This session will offer an overview of the retailers which are best implementing the principles of the omni-channel and share hints and tips that can be replicated in automotive retailing.

16.05

Q&A session

16.15

Drawing on Auto Trader's vast digital background and wealth of data this session explores online consumer behaviour, used car buying trends and the emergence of digital-only retail choice. Bluck and Patel will provide a window into the ever-changing world of today's digital car-buyer who now undertakes the majority of the buying process online.

Auto Trader continues to amass a colossal amount of digital information which acts as a barometer to the consumer market enabling the group to spot typical behaviours and emerging trends before most other players in the sector. Combined with insights from some of the most progressive retail online businesses, Auto Trader shows how a fexible and open-minded approach to digital enables adjustments to be made for on-going success.

Workshop 3

Is your sales process fit for the digital age?

Nick King, market research director and Peter Watts, brand director, Auto Trader Perhaps the last bastion of the old fashioned retail model is car sales, which largely deploys the same sales method it frst adopted more than 100 years ago. Whilst dealers have embraced the digital age with interactive websites and digital marketing campaigns, it has failed to recreate the online consumer expectations of a quick, effcient and focused experience in its showrooms. With real consumer insight, Watts believes the consumer now has the upper hand. Those dealers with a bold vision, innovative approach and the willingness to ditch out-dated sales methods will be the ones which succeed. This session will show delegates how it can be achieved quickly and easily.

Summing up and departure

www.amdigitalmarketing.co.uk To book please contact Emma-Louise Kinnaird on emma-louise.kinnaird@bauermedia.co.uk or call 01733 395133.

#AMAUTODIGI

SHOWROOM 56

Audi A1

The UK is the world’s biggest market for Audi’s smallest hatch, which has become more efficient after mid-life revisions.

THE CARS DRIVING YOUR BUSINESS

58

61

Mazda3

We look at how the Skyactiv range of new engines has helped to transform Mazda’s fortunes in the UK.

Seat Ibiza

Selling the virtues of this Ibiza’s clever active cylinder technology engine should come with caution.

We’ve found its alter ego.

62

Volkswagen Golf

The Golf has proven itself as the greatest all-rounder family car in the market. But does that come at the expense of thrills?

FIRST DRIVE HYUNDAI i20 – ON SALE NOW

Hyundai takes on the big boys

Dealers are expected to take two thirds of the i20’s expected 17,500 annual sales

Hyundai is aiming to chip away at the Ford Fiesta’s dominance with a design-focused supermini

By Harry Longstaff yundai is keen to keep its sales momentum moving towards its goal of a 5% market share with the new i20, as it competes against tough mainstream competition from the likes of the UK’s most popular car, the Ford Fiesta.

Hyundai saw a slight dip in market share in 2014, down from 3.4% to 3.3%, despite a registration increase of 6.59% for the same period, but new models, such as the i10 city car and this new i20, will help claw back some segment share for dealers. The new supermini will have a retail bias, with

H

54 February 2015 am-online.com

“The i20 is a further move

by Hyundai towards premium and being more designfocused”

dealers taking two thirds of the expected 17,500 annual sales.

That is a lot of volume for Hyundai, which saw registrations for the current generation i20 peak at 14,729 last year (see graph, above), but it’s minuscule in comparison with the Fiesta, which moves 120,000 units a year in the UK. On the positive side, that shows Hyundai dealers have a big market to go for and it’s possible the i20 could chip away at some of Fiesta’s market share in the supermini segment.

The 1.2-litre petrol SE will be the most popular engine and trim combination.

There are perfectly serviceable 1.4-litre and 1.1-litre diesel engines, but the petrol is refined, with very little noise filtering through into the cabin, even at motorway speeds.

The i20 is a further move by Hyundai towards premium and being more design-focused, rather than value and practicality.

When looking at it next to its predecessor, there has clearly been progress. The rear of the car looks tidy and the black C-pillar adds an element of premium flair. Some of the design

F O R M O R E R E V I E W S V I S I T: w w w . a m - o n l i n e . c o m / r o a d t e s t s

S P EC I F I C AT I O N Price £10,695-£16,725 Engine 1.2-litre 73bhp, 1.4-litre 100bhp petrol; 1.1-litre 84bhp, 1.4-litre 88bhp Performance 0-62mph 12.1-16 secs, top speed 98-114mph Transmission 5sp man, 6sp man, 4sp auto Efficiency 51.4-88.3mpg, 112-155g/km CO2 RV 3yr/30k TBC Rivals Volkswagen Polo, Ford Fiesta, Toyota Yaris

The rear of the car looks tidy and the black C-pillar adds an element of premium flair

There is a competitive level of standard equipment on the i20 SE

H Y U ND A I U K i2 0 R EG I S T R AT I O N S 15,000 12,000 9,000

2009

2010

2011

2012

2013

2014

changes bring the i20 closer in line with brands such as Volkswagen and Toyota, which both skirt a middle ground between volume and premium. That, ultimately, is where Hyundai wants to be, leaving Kia to be funky and ‘young’.

Hyundai specifically mentioned the Volkswagen Polo as the benchmark for this car and areas such as the cabin quality are a clear step forward over the current i20. While it’s not quite at the level of the Polo, there are now some nice softtouch plastics and in terms of quality, it surpasses rivals such as the Toyota Yaris.

Unfortunately, Hyundai Kia’s design boss, Peter Schreyer, did not influence design on the i20 (or the recently revealed i20 coupé), so from the front end it does look quite generic.

He is expected to have more significant input into new generation models after the i20 coupé. Schreyer’s influence will give Hyundai the kick in the design department it needs to take the brand to the next level.

Trim levels have been given an overhaul, with the Classic,

Active and Style trim levels jettisoned in favour of S, S Air, S Blue Drive, SE, Premium and Premium SE. The idea is that these, particularly SE, are much more familiar as trim names for customers and residual value-setters.

There is a competitive level of standard equipment on the SE, which comes with 16-inch alloys, voice-activated Bluetooth, cruise control, lane departure warning system, rear electric windows and reverse parking sensors.

Where Hyundai has been a bit bolder is with its infotainment system. Quite rightly at this price point and market segment, Hyundai has done away with a traditional touchscreen system on the Premium trim, instead preferring a smartphone dock on top of the dash.

Customers can link their phone to the car via Bluetooth, using apps such as Google Maps or Scout as their sat nav.

This essentially makes sat nav free on entry- and SE-level models, giving dealers a nice differentiator to talk about in the showroom. That doesn’t mean dealers lose out on an upsell opportunity, however, as there’s still the option of a seven-inch touchscreen. The Premium SE trim adds large car features such as heated front seats, heated steering wheel and an opening panoramic sunroof.

Hyundai’s move towards premium does mean pricing for the i20 is creeping up and at £12,725 for the top-selling 1.2 SE, there is only a £235 price gap between it and a Polo SE. It says a lot about Hyundai’s confidence in the product to compete with the big boys.

WHAT YOUR CUSTOMERS WILL BE READING ABOUT THE HYUNDAI i20 AUTO EXPRESS The new car is very spacious and well kitted out, but in such a competitive sector its shortcomings – in terms of ride and performance – are highlighted. Still, the arrival of the new three-cylinder turbo next year could change all of that.

AUTOCAR The new Vauxhall Corsa with a 1.4-litre turbo is a few hundred pounds cheaper, nearly as roomy inside, and feels much faster in everyday driving. Hopefully, the new 1.0-litre T-GDI engine will arrive sooner rather than later, and give the Hyundai a bit more of a fighting chance.

THE TELEGRAPH The i20’s roomier-thanaverage interior, fine driving manners and competitive pricing makes this one of the better buys in the small hatchback class, especially when you remember it comes with the reassurance of a five-year warranty.

am-online.com February 2015 55

IN MARCH’S ISSUE

C O N TA C T U S

PUBLISHED FEBRUARY 27

AM, Media House, Lynch Wood, Peterborough PE2 6EA Email: AM@bauermedia.co.uk If you or someone you know are aged 16-24 and are interested in work experience opportunities at Bauer Media go to www.gothinkbig.co.uk Editor Jeremy Bennett 01733 468261 Managing editor Tim Rose 01733 468266 Senior reporter Danielle Bagnall 01733 468343 Industry editor Tony Willard

Face to face: Glyn Hopkin MD Fraser Cohen reveals how Glyn Hopkin has overcome recessions and challenging brand relations to set a goal of £500 million turnover and 2% return on sale.

How much does the carmaker’s marketing matter?

We examine the marketing channels manufacturers must use to better support their franchised networks.

The 2015 AM Awards All the winners from motor retail’s most prestigious awards ceremony, with full details of why they won.

First drives: Ford Mondeo and Volkswagen Passat The D-segment giants are set to continue the battle in the company car market.

ADVERTISERS’ INDEX Autoclenz ..............................................52

DSG Financial Services.....................33

Mapfre Abraxas....................................8

Autoguard Warranties...............44/45

EDT Automotive ............................46/47

Marketing Delivery ............................50

Auto Trader ..................................2/3/51

GForces .................................... 10/39/59

BCA .........................................................53

IMI............................................................63

Moneypenny.........................................29 Motors.co.uk ........................................40

Black Horse..........................................14

Infomedia ..............................................68

Bluesky Interactive............................27

iVendi................................................38/43

Call it Automotive...............................58

Lawdata.................................................52

City Auction Group .............................36

Loughborough University................29

Symco Training....................................37

DMS ........................................................35

Manheim ...........................................4/24

Trusted Dealers..................................12

66 February 2015 am-online.com

Paragon Automotive .........................60 Supagard.........................................13/52

AM production Head of publishing Luke Neal 01733 468262 Production editor Finbarr O’Reilly 01733 468267 Designer Erika Small 01733 468312 Contributors Debbie Kirlew, Harry Longstaff, Chris Lowndes, Rupert Pontin, Prof Jim Saker AM advertising Commercial director Sarah Crown 01733 366466 Group advertisement manager Sheryl Graham 01733 366467 Head of project management Leanne Patterson 01733 468332 Project managers Kerry Unwin 01733 468327 Angela Price 01733 468338 Lucy Peacock 01733 468338 Account managers Sara Donald 01733 366474 Richard Kerr 01733 366473 Kelly Crown 01733 366364 Recruitment enquiries Richard Kerr 01733 366473 AM publishing Managing director Tim Lucas 01733 468340 Office manager Vicky Meadows 01733 468319 Group managing director Rob Munro-Hall Chief executive officer Paul Keenan Subscriptions 01635 588494. Annual UK subscription £99, two years £168, three years £238.

Overseas one year/12 issues £149, two years £253, three years £358.

AM is published 12 times a year by Bauer Consumer Media Ltd, registered address 1 Lincoln Court, Lincoln Road, Peterborough, PE1 2RF. Registered number 01176085.

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 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 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 editions.

We cannot accept any responsibility for unsolicited manuscripts, images or materials lost or damaged in the post. Whilst every reasonable care is taken 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, resulting from the use of the magazine.

Printing: Headley Brothers Ltd, Kent Complaints: Bauer Consumer Media Limited is a member of the Independent Press Standards Organisation (www.ipso.co.uk) and endeavours to respond to and resolve your concerns quickly. Our Editorial Complaints Policy (including full details of how to contact us about editorial complaints and IPSO’s contact details) can be found at www.bauermediacomplaints.co.uk. Our email address for editorial complaints covered by the Editorial Complaints Policy is complaints@bauermedia.co.uk.