Car Dealer Magazine: Issue 43

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Korean firm’s Mondeo beater? P32

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Issue 43 | October 2011 | CarDealerMag.co.uk | £3.50

SPORTING CHANCE HOW ONE CAR TRansformed KIA p46

FEATURE

AWARDS

SPECIAL REPORT

61-reg

EWARDS 11

web guide

a midnight meeting with 61-reg Fords p40

Enter your site for the chance to win p56

firms that can make you a web winner p58

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m rs co ca ! rade. of w art s no .hpiic ed le ww dr sa aily w un r d d H foloade

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The right cars for your forecourt browse and buy a wide range of ex-fleet cars! r e t s i g e R FREE

HPI iCar Trade offers you: A wide range of different age and mileage cars.

New stock that is constantly changing and updating.

Refurbishment options – sold as seen, BVRLA fair wear and tear.

A clear on-screen price, which includes buyers fees and refurbishment where selected.

HPI iCar Trade is an easy to use website which will give you access to quality ex-fleet stock. You will have the opportunity to source, view and purchase these vehicles as soon as they are available for sale.

Register FREE at www.hpiicartrade.com or call us now 0845 300 8901

hpi icar trade Buying and selling made simple HPI and the HPI logo are registered trademarks of HPI Limited. Š 2011 HPI Limited. All rights reserved. HPI is a Solera company. Registered in England No.4068979 E&OE: HPI pursues a policy of continuous product development. Product specification and pricing may be subject to change without prior notice. Terms and conditions apply. &alls will be charged at local rate and may be recorded and/or monitored.

HPI_iCAR AD_0811

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Blackball Media Endeavour Quay Mumby Road, Gosport Hants, PO12 1AH T: (023) 9252 2434 W: CarDealerMag.co.uk Editorial Director James Baggott james@blackballmedia.co.uk Twitter: @CarDealerEd STAFF WRITER James Batchelor james.batchelor@blackballmedia.co.uk Twitter: @jrrbatchelor ADVERTISING Manager Duncan Chappell duncan@blackballmedia.co.uk Twitter: @CarDealerAds Advertising EXECUTIVE Jade Simmonds jade@blackballmedia.co.uk Twitter: @CarDealerJade

Contributors Graeme Windell, Matt Richardson, Mike Askew, Mike Jones, Big Mike, Alex Goy and James Litton

Thanks to...

IGNITION.

been to a few car factories Welcome. I’ve now. In this line of work it

happens quite a bit. But none has been more surreal than Kia’s Slovakian plant. Nestled in the mountains near Zilina, the huge complex was sprawling.

But as we pulled up outside the huge factory gates and stepped inside the grounds, I was struck that this didn’t look like an industrial plant, firing out thousands of Kias – it looked like a Bond baddies’ lair!

Now I’m not for a minute implying the Koreans’ work is evil – the law and the fact it’s extremely untrue prevent that – I’m merely suggesting if Daniel Craig and his cronies need a suitable location for their next flick, Kia could assist.

What makes me say this? Well, the whole place was so perfectly manicured it didn’t look real. There were expensive trees that had been shipped in from abroad, grass that looked like it had been trimmed with nail scissors and staff (definitely not henchmen) walking around in just-pressed boiler suits.

As the tour continued my suspicions Blofeld had something to do with it were heightened when we entered a huge room with a wall of TVs being monitored by seriouslooking personnel. I half expected the bald, cat-stroking one to spin around in his chair at any moment. ‘Ah, Mr Baggott, we’ve been expecting you...’

It really was quite strange. However, having just shelled out my own cash on a Sportage, seeing the process it takes to build one, the attention to detail and the incredible amount of technology that’s deployed to make it happen, really

hammered home the fact I’d made the right choice.

Five years ago a journalist spending their own money on a Kia would have been a laughing stock – how things change in such a short space of time. You can turn to p46 to see the story of one special Sportage’s birth.

SMILES August saw the first rise in new car registrations for more than a year. It was June 2010 that we last reported a rise and it brings a smile to my face to be finally bring you some positive news again. However, there are rumours much of the jump could be down to pre-registrations with many of you attempting to meet targets.

As the 61-platers roll out of your showrooms, let’s hope that those plus figures aren’t a one off. We spent time with one very busy Ford dealer for a mass of midnight handovers to mark the new reg. Our report on p40 proves there is still excitement among buyers to have two new digits on their numberplates.

And finally we open entries for our coveted Ewards this month. These have been growing every year and for 2011 we’ve added a few new gongs. I look forward to looking through your entries. Turn to p56 to find out how you can take part. Enjoy the issue.

James Baggott, Editor

Chris Jervis, Linda Baggott, David Brown, Tim Naylor, Tim Smith, Martin Hill, Tim Heavisides, Richard Hoggart and Don Brough

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CarDealerMag.co.uk | 03

Safe&Sound Dealer Newhall Cars

Stand Your Ground with ‘Safe&Sound’ Whilst the economy begins to emerge from a recession, the rate of inflation still remains high and the continued lack of consumer confidence has undoubtedly had a dramatic effect on sales in the used car business.

With customer footfall down, car dealers will need to look at alternative ways in which to entice buyers into their showrooms. It is vital for them to stand out from the crowd. In these toughest of trading conditions successful used car dealerships need to present customers with something a little different, a package that separates them from the competition and enables them to offer their customers total peace of mind when buying a used car.

2011 AWARDS

Winner Identifying this need for a competitive edge, the WMS Group have designed the ultimate warranty package ‘Safe&Sound’ that is good for both the motor trade industry and the car buyer. Their research showed that the top three things that car buyers looked for were safety, value for money and reliability – ‘Safe&Sound’ was developed to cover these requirements, plus take care of those additional worries such as whether the mileage is correct and if breakdown cover is provided.

This unique programme guarantees customers complete peace of mind when making the important decision to buy a used car, and has been personally endorsed by Sir Stirling Moss OBE who describes it as 'a winning car warranty scheme for motorists in the UK.'

Safe&Sound is only available from a network of appointed dealers who embrace the very highest standards of customer service. The programme includes a wear and tear 6 month all mechanical and electrical warranty*, 60 point vehicle inspection, 6 month comprehensive recovery package, provenance check (HPI), mileage verification, independent valuation from the UsedCarExpert.co.uk and a dealer buy-back guarantee. This market leading, value added car warranty package is automatically included with EVERY qualifying vehicle sold by a ‘Safe&Sound’ approved dealership. Until now there has been no other programme like this for dealers that combine all seven elements.

Newhall Cars of West Kirby were one of the first dealerships to join the ‘Safe&Sound’ dealer network and report that their customers have been very impressed by the scheme which has assisted the sales team in converting prospects to actual sales.

Nick Marrs Group Sales Manager for Newhall Cars comments: “Offering our customers the innovative ‘Safe&Sound’ warranty package has undoubtedly (re-enforced) customer confidence in our used car offering and given them the ultimate peace of mind in their purchase. The scheme has added great value to our sales package and has most definitely set us apart from our competitors, giving customers a compelling reason to choose their car from Newhall as opposed to one of our rivals”.

To find out more information about the scheme visit

www.safeandsound.co.uk

*Wear and tear applies to vehicles up to 6 years and 60,000 miles at the policy inception date that have not exceeded 85,000 miles at the time of claim.

A support product is available for vehicles which have exceeded these parameters. Please note that service items are specifically excluded.

Nick continues: “We believe that the six month mechanical and electrical warranty and the comprehensive recovery package is definitely the key selling point in this package. In the past many of our customers have remarked that the vast majority of car warranties are ‘not worth the paper they are written on!’ However this warranty really does give the ultimate protection and our customers have recognised this, so it is safe to say that this has definitely been a deciding factor in closing the sale. We have found that the benefits of buying a ‘Safe&Sound’ car appeals to all customer profiles and the personal endorsement of the scheme by Sir Stirling Moss is the icing on the cake as it re-enforces the brand integrity.

When customers see the ‘Safe&Sound’ flags on our forecourt they know they are going to buy a safe car and make a sound investment.”

The WMS Group are currently recruiting dealerships nationwide that would like to become part of the 'Safe&Sound' network. In a highly competitive market under tough trading conditions 'Safe&Sound' really can help your dealership to gain competitive advantage and maximise profit opportunities.

For further information, please call Eric Stone on 07789 682502 or Malcolm McIntosh on 07770 343330.

Join Car Dealer Club by visiting CarDealerClub.com Members get free legal advice worth £199 for a £25 annual subscription

46

INSIDE.

COVER STORY

We watch the 7,000th UK Kia Sportage built at Slovakian plant

ISSUE 43 I October 2011

dashboard

56

55

Ewards 2011

Plus Guide to the Web

11

DASHBOARD

Fiesta RS a possibility?

911 for 2011

Another step on our ladder

‘‘

Our services are online because we feel it’s the right way to do business.

HPI iCar offers stock answers

52

40

Feature

We help hand over 61-regs

Feedback

07

What car buyers really want

08

Ford won’t rule out Fiesta RS

11

Could Kia enter Formula 1?

14

Around the World

17

Used Car Expert

18

HR Owen’s grand plans

20

Helpdesk: Ask Lucy

22

Golden Ticket winner?

25

Finance

26

Black Horse’s new products

28

Big Mike

31

forecourt Hyundai i40

32

Toyota Yaris

34

Infiniti M35h

36

Vauxhall Insignia

37

Volkswagen Jetta

38

Alfa Romeo Giulietta

39

features Midnight 61-reg handover

40

Building a Kia Sportage

46

HPI iCar insight

52

911 for 2011 update

55

Ewards 2011

56

Car Dealer Guide to the Web

58

Supagard insight

68

DATA FILE

a month in A picture...

This month we’ve mostly been in Wales preparing for our Road Test of the Year special issue next month (which we stupidly thought was this month. Sorry). It involved lots of petrol, lots of service station pasties, Red Bull and lots of waiting around. As Alex Goy and Batch demonstrate here.

Skoda’s rise to success

71

Right Click

73

Net Gains

75

Auctions

76

The Statistics with Motors.co.uk

79

Suppliers Guide with Alex Goy

82

Trader Directory with James Litton 84 Shares

87

Sub-Prime Time

90 CarDealerMag.co.uk | 05

WHEN A VEHICLE BREAKS DOWN, DOES YOUR BUSINESS LOOK UP?

Bad news? Not always. Especially if your customers have a quality warranty.

Research shows that customers who are happy with a warranty are more likely to return for repairs, servicing and new purchases. Last year, Car Care Plan spent more than £50 million on parts and labour. That’s business that you could be getting a healthy share of. Why not check us out. Or look us up. Call 0844 573 7591 or visit www.carcareplan.co.uk to discover more opportunities for you.

Car Care Plan Limited is authorised and regulated by the Financial Services Authority.

feedback.

Your comments via email at james@blackballmedia.co.uk | From our website at CarDealerMag.co.uk | And from Twitter: Follow @CarDealerEd

What if you were as bad as BT? bit.ly/poorasBT My experience with BT, both as a domestic customer and a business, has a been utterly appalling too; once they have you they couldn’t give two hoots.

But my experience with much of the car trade has been similarly appalling. In how many other industries do you have to go to three or four different outlets before you find one with semidecent customer service?

I know a bit about cars, so I know when I’m being lied to in a bodyshop or about an MOT – I’ve been told flat-out lies on at least two occasions.

I’ve had cars in for weeks that have come out with the same problem, having parted with a couple of hundred quid. I’ve experienced a level of disinterest and rudeness in dealerships I’ve never experienced anywhere else.

Thankfully these incidents are few and far between, there are plenty of great garages and dealerships out there – and I’m glad I know where to go to find them – but in my experience the car industry is right up there with BT in how poor the service can be.

Robin Brown, via CarDealerMag.co.uk

twitter comments

Another classic Batch in a car video Ahead of our Road Test of the Year next month check out our man James Batchelor’s reaction to his first ever ride in a Caterham. Clue: He was scared. Very. See it by typing bit.ly/batchvsr400 into a browser.

‘This is what fear looks like.’ Classic!

Via @stuartg917 Not sure if it’s the acting experience but he seems to cover just about every emotion in just over two minutes!

Via @MikeNorthWines

I sensed a bit of Will Young lookie likey at full throttle ha!

Via @dannyroyston

Just had to watch that video again it’s an absolute classic! #Caterham

Via @StevenJEllis

There are an increasing amount of internet people pointing out the presence of pavements and houses...

Via @JWinstanley

That made my weekend.

Via @thetimhutton

Kia to compete in F1?

bit.ly/KiainF1 I have followed Formula 1 since I was a boy and can remember the very first race in 1950, won

by Dr Guiseppe Farina. I currently own two Kia Sportages and think that they are great little cars, but no way can I envisage Kia as a Formula 1 aspirant. I would love to be proven wrong!

Tim Holt, via CarDealerMag.co.uk Naturally, it would be great to see another large car manufacturer competing. A great investment for little return. Hopefully, technology developed

and used there will filter back into cars from manufacturers sooner and cheaper!

Reg L van Buuren, via CarDealerMag.co.uk

Alfa maintains strong sales

bit.ly/Alfastrongsales Great to see an iconic brand growing its presence in the UK. Having driven one in Italy recently, I was genuinely impressed by the build quality, layout and overall feel of the driving experience.

Stuart Niblock, via CarDealerMag.co.uk

Sales up in August

bit.ly/newcarsalesup I still feel that it will be a struggle to convince people that it is a good time to change. Only if your manufacturer offers a great deal on finance or discount will you do well. Customers, although concerned about the environment and eco cars, are far more likely to change if the money is right. I get a distinct feeling that people care less about the economy and only about number one – themselves.

Adrian Colewell, via CarDealerMag.co.uk

MY CONFESSION

The runaway Avensis I used to work at a Toyota dealership. Situated at the top of a short hill and among other dealers, it was actually a good place to be... most of the time anyway. We had a delivery of new cars midmorning on a busy Monday. As a keen member of staff, I jumped up from my desk and went to help get the 10 or so cars sorted.

There were quite a few customers on the forecourt that day, so we were acting as professional as possible. As I got in to a new Avensis, my boss called me on my mobile. I got back out of the car so I didn’t get seen by a punter on the phone behind the wheel.

Concentrating on the call – it was my boss after all – I had no idea what was happening behind me… I’d left the handbrake off. As I spoke to the boss on the phone, I heard a screech of tyres behind me as I turned to see a lorry mounting the pavement to avoid an out-of-control Avensis.

‘Hello? Are you there?’ my boss asked. ‘Er… yeah, yeah sorry boss, umm two secs.’ I ran like the wind after the car. It was gathering speed as I was slowing down – it’s not easy to run in Loakes!

Luckily it was now heading away from the £300k plus of Lexus metal. Cars were swerving all over the place as it carved a path down the

road. The hill levels out at the bottom and the car slowed, it mounted the kerb on the corner and came to rest on the right side of the road. Lucky.

Keeping professional, I put my phone to my ear, ‘Sorry boss. You were saying?’

I looked back up the hill to see the trail of devastation. People were stood beside their cars on the pavement scratching their heads, the driver of the lorry looked a little annoyed and all the Lexus guys were at the window laughing at me.

But, my boss was none-the-wiser and nothing was dented – just my pride.

PS, Surrey CarDealerMag.co.uk | 07

DASHBOARD.

Heavisides

warranty wonders

Service plans can build margin and relationships

S

eptember is a great time for our industry.

Once the initial clamour for 61-plate cars dies down, the used-car market will pick up the pace as the part-exchanges hit the forecourts mid-month and a new set of buyers comes through the doors.

For dealers, it’s the perfect time to generate additional margin through the sale of add-on products – but regardless of whether customers are buying new or used, bringing them back to your dealership should remain a key objective. Commission from finance or GAP gives an upfront benefit but there’s no downstream opportunity to deliver further profit.

The good news is that every customer needs to maintain their car through routine service and maintenance work – warranty and service plan products accommodate this requirement perfectly. Every car that leaves your forecourt, new or second-hand, needs a service at some point and bringing the customer back to you is the perfect way to build both margin and relationships.

With the cost of motoring on the rise, customers are looking at every penny and warranty and service plans let the customer budget for running costs. If your service plans can discount parts and labour costs upfront, you can actively show the customer how much they’ll save over time and add real value to the sales proposition. Being able to provide every customer with a quote for a service plan and an extended warranty at handover stage is a great opportunity to explain how you can help the customer save money over time.

Of course, bringing the customer back isn’t an activity that’s confined to sales teams when customers buy a car – aftersales have a role to play too and with access to simple and flexible products, the whole operation can help build lasting customer relationships.

We know that dealerships which embrace warranty and service plans at all levels of the business fill workshop bays and turnover more parts much more readily than those who don’t, and profit usually follows as a result.

And these products really do help take the worry out of buying a new car.

‘Warranty and service plans let the customer budget for running costs.’

Who is Tim Heavisides?

Heavisides is CEO of Car Care Plan, the UK’s leading provider of motor warranty and GAP products.

08 | CarDealerMag.co.uk

Finance fraud unit receives fifth consecutive year of funding bit.ly/fraudunit

Buyers love looking at Fords, according to Auto Trader data And when it comes to the new 61 plates, superminis are in pole position

w

hich cars are buyers most keen on at the moment? It’s the question every dealer asks, but now Auto Trader thinks it has the answer.

The advertising giant has analysed search data ahead of the 61-reg and has revealed what it thinks are the most popular cars.

Their data shows page views of the Ford Fiesta jumped 66 per cent month-on-month on the new car section of its website, while the Ford Focus saw the largest increase in monthly views – 91 per cent – and the second highest number of total views in July.

Auto Trader’s data also predicted the type of car most likely to sport the new 61 plate.

That honour fell to the supermini sector

Most viewed Ford Focus - 91 per cent Volkswagen Golf - 69 per cent Ford Fiesta - 66 per cent Vauxhall Astra - 61 per cent Vauxhall Corsa - 60 per cent BMW 3 Series - 55 per cent Audi A3 - 54 per cent BMW 1 Series - 44 per cent Fiat 500 - 45 per cent

with four of the top 10 viewed cars falling into this category. The firm concluded the data suggested rising motoring costs have prompted consumers to downsize.

The Focus led the rise in page views at 91 per cent, followed by the Volkswagen Golf at 69 per cent, the Fiesta with a 66 per cent rise, and the Vauxhall pairing of Astra and Corsa at 61 and 60 per cent respectively.

The number of views of the cars also tallied with a growth in the number of views of Auto Trader’s new cars website, growing in July from 434,535 to 672,205.

Tom White, head of new cars at Auto Trader, said: ‘The Auto Trader new cars site has already become one of the leading destinations for buyers in the UK. ‘Our innovative products are ensuring dealers receive quality responses at a number of different levels of consumer search and this in turn is helping them sell more new cars. We will be bringing more new products to market over the coming months to further strengthen the proposition.’

More search analysis, p80

Brits haggling hard to get better 61 plate deals MOTORING.co.uk believes 56 per cent of Brits are haggling ‘hard’ or ‘very hard’ when buying their 61 reg cars.

Recent research revealed that rising fuel bills, taxes and the cost of living were the reasons for buyers’ attempts to get the best deal for their 61-plate vehicles.

Nearly half of car buyers cited running costs and MPG figures, and a third said they were planning to buy a greener, more fuel-efficient car.

One in six car buyers would downsize to a smaller car in order to save on the purchase and running costs, says the firm.

Chris Green, co-founder and sales director of Motoring.co.uk, said: ‘Haggling for new cars is a sign of the

lengths people are going to to save money and get a better deal as motoring costs continue to rise.

‘However, there are some great manufacturer deals around which is good news for dealers and car buyers.

‘It is encouraging to see that the major car brands have responded to motorists’ concerns over running costs and have brought to market lower-cost, fuel-efficient vehicles that will suit tighter budgets.

‘We know from the search on our site and our new car buyer data that there is a large demand for new cars under £12k.

‘The percentage of searches under the 12k price is over 68 per cent.’

61-reg special, p40

You want to sell a second-hand car At Motors.co.uk we’re doing all we can to help you sell your cars – like reaching 1.5 million* people with your stock every month and freezing our advertising prices until 2012.

And you want your to ring with enquiries. Well, with Motors.co.uk being promoted in the Daily Mail, The Mail on Sunday, Metro and over 200 regional newspapers, as well as online with Parkers, Honest John, Desperate Seller and Teletext Cars, you’re sure to get some interest.

To advertise your stock, call us on 0845 265 6000, or email sales@motors.co.uk

Your search ends here. *comScore July 11

Online Advertising

DON’T LET THE COMPETITION RUB OUT YOUR AFTERSALES REVENUE

The UK replacement tyre market is worth over £1.29bn* and 9 out of 10 customers still rely on you for the ‘right tyre’ Tyre replacement is the second most frequent reason for a motorist to visit a dealership or workshop, and it is also one of the highest value items when maintaining a vehicle.

NetDirector® Tyres™ has been designed to help dealers promote and sell more tyres both online and in the showroom, giving customers the opportunity to compare prices and brands. Combine this with regular advertising and reminder emails, and dealers can continue to build on customer retention and increase aftersales revenue.

0845 658 9290

www.gforces.co.uk

DASHBOARD.

Saab Automobile files for voluntary reorganisation bit.ly/saabfiles

Don’t rule out an RS Fiesta – and we still own XR badge too Ford boss tells Car Dealer there are some exciting models to come

F

ord has given its strongest hint yet that an RS badge could grace the rear of a potent Fiesta. In an interview with Car Dealer, Ford of Britain’s product marketing manager Steve Humbles refused to rule out a firebreathing Fiesta to hark back to the RS Turbo of the early nineties.

He also revealed that the XR name, that graced legendary cars such as the Fiesta XR2 and Escort XR3i, isn’t dead – merely on sabbatical – and explained why it’s highly unlikely we’ll ever see another Cosworth-badged Ford.

‘Personally, I’d like to see a very sporty Fiesta,’ said Humbles. ‘We’re always looking at opportunities in the marketplace and there are competitors that have a sporty B segment car and we haven’t. There’s nothing I can tell you about at the moment, but that’s not to say there won’t be in the future.’

Demand from America could see an RS model introduced here too. Ford now produces cars on a global basis and it’s hard to get sign-off for models for specific countries as it did in the past.

But the fact that rally star Ken Block drives a Fiesta WRC car, like this one pictured, will put pressure on the maker from the States to make a road-going version, albeit one that’s slightly

less powerful. An ST is likely to be first and depending on the success of that, an RS could follow.

‘One of challenges we have is that our cars are developed on a global platform,’ explained Humbles. ‘The British market is fairly unique in its demand for small sporty hatchbacks. But, that said, we’re aware we have very strong heritage there and that means there are opportunities.

It’s certainly a case of never say never – and more a case of watch this space!’

Humbles added that Ford still owns the XR brand, and although a return can’t be ruled out completely, he thought it would be unlikely. ‘It’s most certainly not dead,’ he said. ‘We still own the name.’

So what about Cosworth? Well, sadly a Focus or Mondeo Cosworth variant doesn’t look likely since the manufacturer no longer has ties with the legendary tuners.

Humbles said: ‘We don’t really have any link there now and we can only use the name if we use their engineering so I can’t see that being revived. Potentially it could if we got together with Cosworth again, but we don’t currently have a relationship with them. Again, the Cosworth heritage is only really very strong in Britain, so it may be difficult to get it approved.’

But despite that sad news, fast Ford fans can still rejoice in the knowledge that the Blue Oval has its aim targeted on producing some thrilling sports models in the future.

Hyundai makes changes after legal challenge HYUNDAI has been forced to change its website AND warranty booklets after a legal challenge.

The IAAF – The Independent Automotive Aftermarket Federation – was prompted to enforce the EU’s Block Exemption Rules after it received a complaint from an independent mobile repairer.

Martin Ryan complained that the Korean firm was refusing to accept warranty claims because he was not registered for VAT.

An inquiry from the Federation’s trade secretary Ann Silvester to Hyundai brought confirmation of their position. Hyundai claimed the ruling was designed to prevent what they described as ‘fraudulent activity’.

A Hyundai spokeswoman told Car Dealer: ‘We take on board what they say and we have amended the website and our warranty booklets to make things clearer.

These changes are currently with our legal team and will be implemented very soon.’

i40 Handbook, p32

Winn Assist

accident management

The dealerships who give their customers bad advice

S

ome years ago, before I knew how you could claim directly against the other driver’s insurer if you weren’t at fault following a road accident, I had an accident and sought advice from my dealership. I phoned them up and indicated I had had an accident that was not my fault, and I wanted my car repaired to a high standard using manufacturer’s parts by them.

I was advised I would have to contact my insurer.

In due course my insurer told me to take it to a ‘cheap repairer’ who repaired my Jaguar with nonJaguar panels and parts, significantly reducing its value.

They gave me a small-geared car when I was used to an automatic.

They settled the case on a knock-for-knock basis requiring me to pay my excess and increasing my insurance premium.

I found out in due course I had been treated badly by my insurer and set up Winn Assist about 15 years ago.

However, there are still a significant number of dealerships acting against both their own interests and the interest of their customers in not assisting their clients to pursue a non-fault claim or pursuing it through the wrong company.

If a customer is not advised properly by his dealership, he is unlikely to return there in the future to purchase a new car or other services.

A dealership referring clients to the right non-fault provider helps them at a time of distress and enhances the reputation of the dealership in the customer’s eyes.

Original parts are sold, and where the dealerships have their own repairer, additional income is earned including referral fees.

Inevitably, those who do develop and help customers in this way will increase market share over those who do not.

I know that I never returned to the dealership who gave bad advice and told me to speak to my insurer. I am sure that thousands of others do the same.

For more information please speak to the Winn Solicitors sales team on 0191 276 9865.

‘I know I never returned to the dealership who told me to speak to my insurer.’

What is Winn Assist?

Winn Assist Automotive provides branded full accident management for your customers and a host of other services. Call 0845 217 2542.

CarDealerMag.co.uk | 11

DASHBOARD.

Hoggart

point of sale

Plenty of options make it a September to remember

A

s interest rates continue to remain at historic lows for month after month, with no sign of an increase on the immediate horizon, car buyers can look to exploit this and secure point-of-sale deals at very attractive rates, whichever method of funding they consider.

Users of DSG will be familiar with the transparency we display on our Maia Online system. Now, more than ever, we are seeing a real uptake on our most competitively priced products.

Bank Robber has been a branded product of ours that has been around for several years, offering APRdriven payments and no fees, originally, in order to compete with the direct lenders. With an increasing number of no-fees products hitting the market, it is apparent that customers not only want low interest rates, but they are now rejecting admin fees in increasing numbers. We now even offer a no-fees PCP product to reflect this requirement. The APR will continue to remain uppermost in the mind of the customer despite it being manually incalculable so it is important that our system allows the user to select a range of APR levels which immediately convert to a payment and commission level.

However, to truly make the most of the low rates, there is no more attractive proposition than the variable rate options that are continuing to be strong players in the market. With the main driving interest rate of LIBOR still just a fraction above the bank base rate, deals on higher advances are looking incredibly cheap. Even if LIBOR doubled, the actual impact on the payments is minimal and the flexibility of the Daily Interest facility is very attractive.

Of course, both Daily Interest and its better-known relation, Balanced Payments, are incredibly difficult to calculate or illustrate. Again, to aid this, we have developed clearly-thought-out calculators on our site that make demonstrating the merits and dealer profitability of such products very simple.

Registering for access to our system is very easy and the wealth of options displayed should ensure that no opportunities are missed this September.

‘More customers are now rejecting admin fees.’

Who is Richard Hoggart?

Richard is managing director of DSG Financial Services. For more information on what his firm can do for you call 0844 880 0660 or visit dsgfs.com.

14 | CarDealerMag.co.uk

GForces produces video on social media for dealers bit.ly/tweetingdealers

Never say never: Kia or Hyundai could be future F1 contenders ‘It’s a numbers game and about return on investment’

K

ia or sister firm Hyundai could one day race in Formula 1, a company insider has told Car Dealer.

The Korean manufacturer has priced up the cost of entering the world’s premier motorsport arena, and although the time isn’t right now, there’s nothing to say it won’t be in the future.

‘We would never say never,’ explained the company executive. ‘I fully costed out seasons in F1 when I worked at head office in Seoul as well as the pros and cons of competing.

‘The thing is you don’t want to race if you are going to be at the back of the grid so the time has to be right. It’s also important for a car company to have the right products to promote off the back of it. Manufacturers go racing to sell cars, but the right cars have to be available that would appeal to the fans.’

Kia and Hyundai is currently the fifth biggest car maker in the world and its resources are plentiful. With growing product ranges and improving brands, the combined company certainly has the

From Kia Rio to Formula 1? Don’t rule anything out

Most would have a hybrid NEARLY 90 per cent of people who might consider an environmentally-friendly vehicle would pick a hybrid.

A recent survey by Manheim Auctions showed that 88 per cent of the people asked would rather own a hybrid with just 12 per cent choosing a purely electric car.

However, the auction firm’s survey found that even though hybrid came out as the clear favourite there were still concerns about overall costs of ownership.

Electric cars also came in for criticism in relation to their levels of sophistication and concerns about access to charging points, battery life and range.

Interestingly, the survey revealed that most people would be willing to pay around £6k for a second-hand hybrid vehicle which, based on current auction prices, would buy a four-year old Toyota Prius or Honda Civic IMA.

assets to make a success of competing in F1. Our company insider also revealed he had investigated seasons in other forms of motorsport including the World Rally Championship and touring car championships around the world.

‘The problem with motorsport, and especially F1, is that the returns are not great,’ he explained. ‘For example, in the UK, around 5m people watch a premier race like Monaco. Compare that to the World Cup, which we sponsor, and some 250m around the world watch that event.

‘It’s all a numbers game and about return on investment. When I investigated entry it wasn’t right for the brand, but with the models in the future that’s not to say that will always be the case.’

Kia special, p46

TOP TRIO

Recipe for success THREE new car dealerships, including flagship Volkswagen and Volvo showrooms, are to open in Solihull.

The dealerships will be based on a former restaurant after it was acquired by Johnsons Cars.

Colliers International acquired the four-acre site, which includes a 50,000 sq ft building, from Gallagher Developments on behalf of Johnsons.

The company now plans to refurbish the building, with work due to start in November. This latest acquisition represents a £10m investment by the firm.

IN

O ..

AC 1.

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dashboard.

Around the world

1m motorists driving without an MOT bit.ly/nomotshock

CANADA

THE world’s first car – the 1886 Benz Patent-Motorwagen – has dropped into a Mercedes-Benz dealer in North Oakville, Canada. The dealership is one of many which the car will be visiting. It is being piloted by Duane Clark on a crossCanada journey to mark Mercedes-Benz’s 125th anniversary.

Dealer news from somewhere other than here CALIFORNIA

A HONDA dealership in Stevens Creek, San Jose, California is devoting a portion of the profit from each car it sells in September to Tribute WTC – the visitor centre opposite Ground Zero in New York – 10 years on from the 9/11 attacks.

The dealership, owned

by Sonic Automotive, has been donating a portion of each new car sale to a different charity every month this year.

EAST COAST OF THE US

DEALERS on the East Coast are counting the cost of the recent severe weather. In August, Hurricane Irene ripped through the region killing 22 people and ruining homes and businesses. There are now fears for the state of the American new car market. Ford, GM and Toyota were finding life tough even before the hurricane because of the Japanese earthquake earlier this year.

KOREA

CHEVROLET is set to add more showrooms to its dealer network after figures showed sales of Chevys were on the increase. The American brand only started selling cars in Korea in March but is keen to increase its presence in the country.

A recent survey showed that 98 per cent of people had heard of the Chevrolet name. New dealership facilities and rebranding are set to be put in place.

CHINA

CAR makers are re-evaluating their dealer partnerships in China due to the burgeoning car market. Volkswagen and Mercedes-Benz among others are investigating the options available to them in establishing wholly-owned dealerships rather than franchises. The large number of foreign cars being sold in the country is on the rise and is set to grow in the next few years.

AS USED

BY THE AA & RAC

Dynomec Ltd · Unit 5 · School Street · The Potteries · Castleford · West Yorkshire · WF10 1NZ

CarDealerMag.co.uk | 17

dashboard.

Recruitment firm Connect HR becomes CARS bit.ly/ConnectCARS

Is the web killing art of sales?

Why the advance of the internet is making the car dealer’s life harder

A

potential buyer went up to the salesman on the forecourt and said: ‘Is the black Freelander a manual?’

‘No, it’s automatic.’

‘Oh, that’s a shame because I would have bought it if it had been a manual. I don’t like automatics. Do you ever get manuals?’

The salesman made an unconvincing attempt to promote the benefits of automatics and then let her go.

When she was clear of us, he turned to me and said: ‘She wouldn’t have bought it. I’ve heard it all before. She thinks she knows what she wants, but she’ll end up buying a white Golf or something.’

Gone are the days when people were just so excited to be buying a slice of freedom that they took whatever was on the forecourt. Thanks to the internet, the dealer’s recommendation doesn’t carry the weight it used to.

In the last 30 days, tens of thousands of people have arrived at UsedCarExpert.co.uk from Bing

or Google with searches as specific as ‘reviews for Volkswagen Golf Plus 1.9 TDI Luna (90 PS) 2007’ and ‘2007 Mazda6 2.0d TS [143] 5dr diesel hatchback review’.

Or my personal favourite, ‘2007 Lexus IS 220d SE goodies.’

That potential Lexus buyer then looked at 10 pages of the site.

You can only do so much to sell these modern-

day buyers your Lexus instead of the Lexus up the road.

The modern car buyer reads so much and looks at so many cars on the web that all you can do is try to match your car with their ever-more-specific shopping list.

We can of course help you do that – we can show your cars with links to your website, to people in your area, next to our reviews on Lexus goodies.

And because we only charge for inquiries, there is no A Freelander or a risk.

Golf? Not a black That way you will get and white issue... people walking onto your forecourt who are looking for a black automatic Freelander, not a white manual Golf.

Who is Matt Tumbridge?

Publisher of UsedCarExpert.co.uk.

You can contact him on mt@usedcarexpert.com or on 07974 778 554 or @usedcarexpert

GET MORE CAR BUYERS TO YOUR WEBSITE ONLY PAY FOR GENUINE VISITS AND ENQUIRIES

We can help get more relevant car buyers TO YOUR WEBSITE Over 4 million car buyers visit us every year

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DASHBOARD. EXPANSION

EAG adds Skoda dealer

Essex Auto Group has opened a new Skoda dealership.

The new site in Rayleigh, is the latest example of the family-run business’s growth plans.

EAG now holds nine franchises and the group employs more than 300 local people.

A spokesman said: ‘It makes sense for us to buy into a franchise that’s as set on success as we are.’

JOB MOVE

‘A fantastic opportunity’

PEUGEOT UK’s managing director Jon Goodman is to take up a new job as the PSA Group’s media director.

Goodman, 47, will move to Paris to take on the worldwide role of director of media relations for PSA Peugeot Citroen.

Goodman has been MD of Peugeot UK since June 2009. He said: ‘This is a fantastic opportunity for me.’

FINANCE

Calculated to be a success WEBZATION has partnered with Trader Media Group’s digital marketing division RAZSOR. The partnership will see Webzation power RAZSOR’s new dealer finance calculator.

Head of product strategy for RAZSOR Christopher Parker-Loftus said: ‘We are delighted to announce our partnership with Webzation.’

20 | CarDealerMag.co.uk

Two millionth Mini rolls off production line bit.ly/2millMini

Up close and personal: HR Owen consider new ateliers H

R Owen could introduce more Ferrari atelier-style personalisation services to its other franchises.

Speaking exclusively to Car Dealer, HR Owen’s chief executive Andy Duncan – pictured above with Felipe Massa – revealed that the luxury retailer is investigating adding more dedicated personalisation suites to its portfolio. And not just with Ferrari but with other franchises too.

‘We wouldn’t add another atelier with Ferrari because the Berkeley Hotel Atelier works very well in its location,’ said Duncan.

‘But one of the things we are discussing at the moment is how we can expand this model across the

Luxury retailer is actively considering the possibility of more personalisation in future board with our other brands. There’s a lot of discussion, energy and ideas around what we could do.’

Duncan also hinted that the recently-acquired Aston Martin, Bentley and Rolls-Royce franchises (through the acquisition of Broughtons) could all be possible candidates for personalisation services, but not in the style of the Ferrari atelier.

‘We wouldn’t do an identical, Ferrari atelier-style idea with our other brands, but the concept of

more personalisation and the focusing on this high-end, luxury experience really appeals to us and our customers,’ he said.

‘The positioning of the group in this top-end sector is very distinctive, and in reality all of our competitors operate in the mass market.

‘For them, the luxury market is a nice thing to have but it is not their core business. It is our core and with atelier-style personalisation services, we will be able to give our customers the ultimate experience.’

Strong first-half performance despite tough economic times LUXURY motor retailer HR Owen’s interim results for the six months ended June 30 show the business’s revenues grew by 17.9 per cent to £93.1m while pre-tax and exceptional profits were up by 8.5 per cent to £1.7m.

The last six months have been a busy period for HR Owen as the retailer opened its Ferrari Atelier at the Berkeley Hotel and acquired Broughtons of Cheltenham.

Andy Duncan, chief executive, said: ‘The business had a strong first half and we grew sales despite the

INSIGHT

challenging economic headwinds. We are particularly pleased to have grown new car sales and improved our used car margins during this tough time.

‘There has been real momentum behind our new growth strategy

“Experience is Everything”, including the opening of our Ferrari Atelier at The Berkeley and the acquisition of Broughtons of Cheltenham which strengthens our Bentley business and takes HR Owen into the Aston Martin franchise for the first time.

‘There are exciting product developments to come during the second half, including the launch of the Ferrari FF and Lamborghini’s Aventador models. However, there is no room for complacency and we remain realistic about the prospects for the UK economy.’

Web yet to challenge forecourt’s supremacy

THE web may have changed consumers’ buying decisions about cars, but the forecourt remains the place to buy.

That’s the view of digital media company Specific Media which found a third of British car buyers think the web makes them less dependent on dealers at the pre-sale stage, and gives them more control of their purchasing.

Half said the internet gives them a wider range of opinion, bringing them to the forecourt better informed, having done their own online research, casting dealers in a post-sale role.

Two thirds of consumers now use the web to research vehicles before purchase, with 38 per cent citing the experience as ‘interesting’ and 32 per cent as ‘enjoyable’, and three-quarters of motorists citing the web as an important influence on their buying decision. However, according to the research, the internet has yet to challenge the forecourt when it comes to actual purchase behaviour.

‘The positive news for dealerships is that people are not yet buying cars over the internet,’ said a spokesman.

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Audi Ireland has worked in partnership with Portfolio Professionally display in the implementation displayed and design of our approved used car programmes. I have forecourts will What do our customers found Portfolio Display to be help towards have to say? professional, innovative and increasing the willing in all their dealings We have selected Portfolio with us and have provided sale of used Display as exclusive supplier an excellent service, which vehicles. for our used car programme. exceeds our expectations.

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helpdesk.

Join Car Dealer Club by visiting CarDealerClub.com Members get free legal advice worth £199 for a £25 annual subscription

Ask Lucy Car Dealer Club lawyer Lucy Bonham Carter answers dealers’ legal questions. Join for £25 a year to get advice like this when you need it

Q

We sold a 2005 Nissan with 90,000 miles and a new MOT to a person who had the car investigated by a third party expert prior to purchase. The third party found a couple of minor faults prior to purchase and we agreed to discount the price to cover getting these fixed. The purchase price was £5,000. After completing 500 miles the customer complained that the engine management light was on and that the car was losing power intermittently. We asked him to check the car into a repairer to see what was wrong with a view to us rectifying the fault. He came back with a list of ‘defects’ found by the garage which went far beyond the original fault.

We contacted the repairer and apparently the car had been checked in with instructions for them to go over the car with a ‘fine-toothed comb’ to find any defects no matter however minor.

They admitted that their list largely comprised ‘fair wear and tear’ items. Fixing the faults came in at approximately £3,000 to which the customer has added the cost of the inspection and has now issued proceedings to recover his loss in the small claims court. What do I need to do?

IR, Twickenham

ADVICE

Pre-crashed Audi RS5 Q. We sold an Audi RS5 which had been pre-owned by a finance house. The car has subsequently been involved in a collision and as a result of that it has become clear that some minor repairs were undertaken prior to us getting it. Those repairs were very well done and were invisible – and it apparently passed the inspection when it came off lease. The more recent accident was a serious one and the car could be written off.

Apparently our customer’s insurer is now saying that the car’s value at which they will settle will be substantially lower (by several thousand pounds) because of the pre-existing damage. The customer is threatening to sue us for the difference. Help!

CJ, Northampton A. Your first priority should be to keep your

customer on-side and to present yourself as offering them assistance and a valuable service.

We suggest we write a conciliatory letter and offer your assistance in dealing with their insurer with a view to their obtaining the full value of their vehicle. Many cars have suffered some repairs and unless they were bodged it is unlikely they would affect the value.

In the first instance, if a claim has been made through the court, at the very least you need to acknowledge the service of court within 14 days or you can have judgment awarded against you by default. By acknowledging service you get a further 14 days to file a written defence. Anyone facing a court case (or even the threat of a court

case) should probably seek advice from us under their Car Dealer Club membership.

In your case the car should be fit for purpose and as described. If the engine management light comes on within the first six months after purchase then the reason needs to be investigated. Unless the fault results from user error (for example, misfuelling), the chances are that you should agree to fix that fault and your response was entirely correct.

However the guiding legislation – the Sale

of Goods Act – is not blind to the age and price of the car. Providing the car is serviceable (as indicated by the MOT), the chances are the court will not find you have to fix every minor fault.

This case should have been settled by negotiation but now proceedings have been issued the court process needs to be followed.

If the proper procedure is followed then the court process includes provision for mediation to settle before a hearing and that is the route I recommend with this case.

Q. We sold an older trade-in to a customer for use by his daughter – a 2001 vehicle with 90,000 miles for £2,500. Shortly after sale a pollution warning light came on so we booked it in to a local independent garage we use who replaced some parts and cleared the fault.

Apparently the fault subsequently resurfaced and rather than coming back to us, the customer decided he wanted it sorting out through a main dealer. During the period with the dealer, additional faults developed and despite it being driven there, the car is now a non-runner. The

dealer quoted £3,000 to repair. Our view is we should have been consulted before the vehicle was taken to the main dealership and that our customer’s gripe over the repair is with them. Can you indicate where the various liabilities lie?

JM, Oldham A. This is a very complex case and were the amount of loss involved much higher it might have resulted in a trip to court. As it is a lowervalue case, we need to keep an eye on the costs and try to seek some mediated resolution.

Mediation is one of the services afforded by

Car Dealer Club which will arrange for a free evaluation. In this case the customer should have given you the opportunity to repair the car as they did the first time and also has a duty to mitigate costs. You could argue that you might have been able to get it fixed elsewhere and are not liable for the full cost of the bill.

However, the dealer did not fix the car and the question is, did they make it worse?

In cases such as this you are often better settling the case with the customer by refunding and cutting your losses.

A

Where do the liabilities lie?

Who is Lucy Bonham Carter?

She is a leading commercial lawyer specialising in automotive. She heads the legal team at AutoLaw, a multi-disciplinary insurance and legal practice which specialises in providing legal assistance on motor trade-related legal issues and she provides advice to Car Dealer Club members. To get advice like this (worth £199) join Car Dealer Club for just £25 per year. Sign up at CarDealerClub.com 22 | CarDealerMag.co.uk

Your advert said this car had air con but it hasn’t.

I want you to pay for it to be retro fitted. What are you going to do about it?

My head gasket has gone on the car you sold me after just a year – I want my money back.

What are you going to do about it?

The car you sold me has been clocked. I want compensation for the money I’ve spent on insurance and my money back. What are you going to do about it?

You sold me this car and I’ve found out it’s had an accident repaired. It’s not worth as much as you said it was. What are you going to do about it?

The clutch has gone on my new car. I’ve only had it eight months.

You should pay for the repairs. What are you going to do about it?

PROBLEMS?

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DASHBOARD.

Men and women car buyer stereotypes are dead bit.ly/Stereotypesdead

Your chance to win an iPad2 and a FREE place at our Profit Clinic F

ancy winning an iPad2?

We’re offering dealers a one-in-75 chance of winning one of the musthave tablets at this year’s Car Dealer Profit Clinic.

Inside 500 randomly-selected copies of this month’s magazine are 500 golden tickets – and if you’ve found one you need to act fast.

There are 100 free places available on our special event being held at the Heritage Motor Museum on December 14 – and you can claim yours if you’ve found a golden ticket inside your copy of the magazine.

The event, held in association with Motoring.co.uk, will bring together a host of business brains from a variety of different automotive arenas to give you best-practice advice on how to make more money at your dealership.

At the event you’ll hear speeches from the assembled experts, have a FREE buffet lunch, and get the chance to look around the Heritage Museum’s collection.

So what do you need to do if you’ve found a ticket in your magazine? Email the editor on james@blackballmedia.co.uk immediately and claim your place at the event by quoting the special number printed on your ticket. Put Car Dealer Profit Clinic as the subject.

The 100 places are on a first come, first served basis. You’ll be asked to pay a £20 holding deposit for your

GREAT YEAR

Summer was sensational!

If you’ve found a golden ticket in your issue of Car Dealer then here’s what to do next THE SPEAKERS Chris Green Who? Motoring.co.uk co-founder Topic: Green will explain how he can help you generate qualified sales leads along with actually being able to measure your ROI. Alex Rose Who? Google industry manager for dealers Topic: Rose will be giving simple but effective strategies that will help dealers online.

WINNS EXPERT (TBC) Who? Accident management expert Topic: Will reveal how turning disaster for a customer into a pleasant experience can do wonders for your business.

Vijay Punj Who? Armour Automotive director place which will be RETURNED to you at the event – this deposit simply secures your place so we definitely know you’re coming. Then, at the end of the Profit Clinic, we’ll hold a draw for the iPads. With only 150 spaces available for delegates, you’ll have an

Topic: Punj will demonstrate how car dealers can work with aftermarket partners to make more money.

Gary Hodgkiss Who? Fourmative managing director Topic: Hodgkiss will tell you how to fix problems via training – with a will, a way and the know-how.

Bob Feltham Who? Contact Advantage consultant Topic: Feltham will show you how to reduce your stock, increase your stock turn and enhance your profits – all while using less cash.

Chris Mason Who? Motor Codes MD Topic: Mason will focus on how garages can maintain credibility and instil confidence at the same time as boosting business. amazing one-in-75 chance of winning.

And you’ll go home with some fantastic ideas for your business.

If you haven’t been lucky enough to find a ticket, you can register your interest by emailing the editor and you’ll be added to the reserve list.

Toyota boss’ great expectations for forthcoming Yaris hybrid TOYOTA GB’s boss has revealed that the forthcoming Yaris hybrid could exceed all predicted volume figures.

The car, which is slated for release next year, will form part of Toyota’s onslaught on the hybrid sector.

The hybrid supermini is expected to be joined by the Prius Plug-in hybrid,

and the seven-seat Prius+ in 2012.

‘We have something to really shout about with the Yaris hybrid,’ Toyota GB’s managing director Jon Williams told us. ‘We’re planning on it being around 20 per cent of the new Yaris’ volume figures. And that is an initial forecast. It could have even more

potential. It is a breakthrough car.’

Dealers are already taking orders for a new, third-generation Yaris, which could sell around 20,000 units in a full year. But they should not expect high take-up for the 1.4-litre diesel version, Williams added.

Handbook: Yaris, p32

FAMILY-owned dealer group JCT600 is on track to achieve its best-ever year of new and used car sales.

Retail volumes for the first eight months of 2011 are already over 1,000 cars higher than 2010 – which itself was a record year.

‘June, July and August have been record sales months for the business,’ said John Tordoff, above, chief executive.

PURCHASING

‘Women are intimidated’ FEMALE motorists still feel intimidated by the car-buying process, new research by Quicks has shown.

The car retailer’s findings show that more than 50 per cent of female motorists said they were more likely to be ripped off by car dealers because of their gender.

The study, conducted among 1,000 female motorists, also reveals that more than 40 per cent of female motorists would not buy a car from a dealer unless they were accompanied by a male friend or male family member.

STRATEGY

Pentagon are on track PENTAGON has acquired Rusty’s Seat and Peugeot in Scunthorpe.

After many years in the motor industry, Rusty’s owner Trevor Mason has decided to sell up and retire. Trevor Reeve, Pentagon managing director, said: ‘Adding another Seat and Peugeot franchise is a major part of our strategy to build stronger relationships with more manufacturers.’

CarDealerMag.co.uk | 25

FINANCE. GLAMOUR

Join Bridford’s Monaco trip THE glitz and glamour of Monaco is on offer to car dealers courtesy of prestige vehicle finance firm Bridford.

Bridford Financial Solutions is offering places on the Bridford Dealers Group visit to Monte Carlo for dealers who reach a certain number of points based on the amount financed per transaction with the company.

The incentive is open to all UK dealers and more than one place per dealership or dealership site is allowed as long as the required points are reached (60 points equates to two places).

ANNIVERSARY

Major interest in Mini deals DEALERS are sure to be bracing themselves for an onslaught of customers after Mini released details on a brace of hot finance deals for September.

To celebrate their 10th anniversary in the UK, Mini will be making the Mini First with a ‘61’ registration available for £169 a month with a customer deposit of £1,499.

All One models will also have a low-rate finance deal available and will come with a Pepper pack and a five year/50,000 miles TLC pack as standard. For Countryman, dealers will cut an extra £500 too.

Fraudsters finding it harder to hoodwink finance companies

Another customer applies for finance... but is the information she has supplied genuine?

FLA members and the police team up to prevent £26.8m of dodgy deals

I

n the last 12 months, almost 30 per cent of motor finance fraud was committed using false finance applications, according to the Finance and Leasing Association’s motor finance fraud figures for the second quarter of 2011.

The figures show that fraudsters giving false information on their applications to secure car finance are most likely to lie about their employment circumstances, often giving details of bogus companies as their employers.

The FLA figures also show that fraudsters use false home addresses and overstate their earnings to increase their chances of getting credit.

Motor finance companies have become adept at spotting fraud and

only one-in-11 fraudulent applications is successful. As a result, fewer than 250 cases of undetected application fraud slipped through the net in the last 12 months.

Motor fraud cost lenders £2.9m in the second quarter of 2011, which was 0.8 per cent lower than in the same period last year. There were 195 cases of motor fraud in the second quarter, and 835 in the last 12 months, a fall of 12 per cent on the previous 12 months.

Working with a dedicated police vehicle fraud unit, FLA member finance companies detected more than 2,100 cases of motor fraud in the second quarter of 2011. This prevented £26.8m of fraudulent deals.

‘‘

Paul Harrison, the FLA’s head of motor finance, said: ‘Application fraud increases in tough economic conditions as people know that it can be difficult to get finance if they have a poor credit history, or an unsteady source of income.

‘But exaggerating their income, hiding previous addresses or giving false employment details to improve their chances of getting a car on finance is fraud and will be reported to the police.

‘We have just entered our fifth year of sponsoring the vehicle fraud unit of the ACPO vehicle crime intelligence service and have recruited additional police officers to help send a clear message that fraudsters will be prosecuted.’

People know that it can be difficult to get finance if they have a poor credit history.

Valuing Service – Valuing You! First Response Finance is the first choice for the UK’s small to medium sized dealer market.

26 | CarDealerMag.co.uk

..in association with

DEAL FINDER Latest finance deals on family cars FORD MONDEO THE Mondeo is a firm favourite of ours – and for good reason. Not only is it by far the most dynamically proficient vehicle in its class, but within the last few months, thanks to a facelift, the Mondeo looks as stylish as ever.

Ford has also got a cracking offer on it.

Part of the Ford Standard – which, among other things, offers a low 4.9 per cent APR figure. The Mondeo that’s available is the 2.0-litre Zetec petrol model.

A deposit allowance of £1,000 goes hand-in-hand with a customer deposit of

£4,320.45. That’s followed by 24 monthly payments of £339, and an optional final payment of £6,642 plus a £10 purchase fee.

This brings the final price to £19,108.45.

Prime source of business find it very difficult to understand why there are still some in the motor industry who appear to be apathetic towards non-prime finance when it is so apparent that it is such a huge opportunity for additional sales and increased business.

Why would anyone deliberately ignore the millions of people who are unable to access high street lending facilities?

How busy are these dealers that they can afford to overlook 30 per cent of the adult population?

Is business so good right now that there isn’t any need to investigate the potential sales that could be made by servicing this market?

If you are one of those who are unfamiliar with the diamonds beneath your feet, then please allow me to enlighten you… The number of people who will fall into the non-prime finance category is increasing and so is the business potential for dealers with a desire for growth.

First Response Finance is a non-prime lender specialising in offering HP facilities to car buyers who are being snubbed by high street banks and their finance subsidiaries – which means we support the hard work and determination of our dealer partners by rescuing deals which would otherwise be consigned to the waste basket.

Because we are good at what we do, we’re pleased to say that we are happy to help an increasing number of customers who come back to us time and time again.

Around half of these returning customers ask us to assist them in finding quality cars in dealerships that will take care of them – and that represents a lot of buyers looking for sellers.

Can anyone really afford to ignore them? Call us anytime for honest and impartial advice.

‘We are happy to help an increasing number of customers.’

ments of £299 follow at 6.9 per cent APR, and the optional final payment is £6,409 if customers want to keep the car.

That brings the final price to £20,222.75.

VW PASSAT IN this sector, you cannot ignore the Passat. The good news for buyers is that Volkswagen has got a finance deal on the Passat saloon which is bound to get the German firm’s dealerships buzzing.

Available on the S – which features alloys wheels and air conditioning – Volkswagen is allowing customers to get into a Passat for a deposit of £5,453.55 followed by 35 monthly payments of £279 at 7.9 per cent APR – the first month includes a £60 purchase fee.

The optional final payment is £5,840 bringing the total amount payable to

time is money

I

MAZDA 6 WE don’t really know why more buyers don’t opt for the Mazda 6.

It’s not only a fine handling car, with some good-quality plastics, but it’s quite a looker too.

Mazda has got a tempting offer on the 6 at the moment. Available on the 2.0-litre petrol Tayuka version, customers will get 18-inch alloys, Bluetooth, and part-leather heated seats.

Mazda has already slashed the on-theroad price by £2,510, which brings the starting price down to a very reasonable £17,995, and asks for a deposit of £3,049.75 from the customer. Thirty-six monthly pay-

Meldrum

£21,118.25. Three years or 30,000 miles free servicing is included too – the only snag is that this car has the 1.4-litre Bluemotion engine; 600cc less than the Mondeo and 6.

Who is Jim Meldrum?

Jim is regional sales manager for First Response Finance. Call him on 07917 460 111 or email Jimm@frfl.co.uk

Tel: 0844 8730819 Web: www.frfl.co.uk CarDealerMag.co.uk | 27

DASHBOARD.

Black Horse’s smart moves The finance provider has responded to feedback and come up with two match-winning new contract hire products. James Batchelor reports

F

or the first time in its history, motor finance provider Black Horse has added two new contract hire products to its range of services for dealers.

Called Personal Contract Hire (PCH) and Contract Hire, the products have been introduced due to feedback from dealers.

It’s a big launch for the firm, which is also one of the largest independent providers of point-ofsale finance to car dealers in the UK. The two new products join Black Horse’s already highly-regarded product portfolio – and to make sure these products are the best they can be, they have been created in conjunction with Lex Autolease, another Lloyds Banking Group business that specialises in contract hire.

To make them as far-reaching and as popular as possible, both products cater for different kinds of customer.

Black Horse PCH is purely aimed at private individuals, while Black Horse CH has been designed with business users in mind, including fleet operators.

However, both products offer a fixed-cost, flexible-term, low-risk rental agreement, which can be easily arranged with dealers – saving time and improving customer satisfaction.

The products also offer an easy way for customers to finance their car. Once the customer has picked their vehicle, they agree a maximum annual mileage figure with the dealer as well as the length of the agreement – from two to five years.

Customers then pay a fixed monthly amount that suits their budget, while road tax is included and a maintenance package can be added on.

Customers just have to pay the fuel and insurance costs, and at the end of the agreement customers just return the car to the dealer – and that’s it.

The process is just as easy for business drivers too – and perhaps even more rewarding.

With Black Horse CH, business drivers benefit

28 | CarDealerMag.co.uk

NEW PRODUCTS

The benefits of Black Horse’s new products Personal Contract Hire • Fixed monthly rental to suit customers’ budgets • Flexible mileage and length of agreement • Optional maintenance package • Hassle-free motoring for customers – road tax included, hand back keys.

Contract Hire • Fixed monthly fee plus VAT so customers can accurately budget • Customers can claim back up to 100 per cent VAT on monthly fee and maintenance cost • Flexible mileage and length of agreement • Optional maintenance package • Hassle-free motoring for customers – road tax included, hand back keys.

in the same way as private individuals – they have the ability to choose their own vehicle, agree their maximum annual mileage, and just return the vehicle after the agreement is up.

But for business drivers who use their vehicle for work, Black Horse CH also allows them to claim back 100 per cent VAT if the customer is VAT-registered and using the vehicle solely for work.

That’s all well and good but what are the benefits for dealers?

Simple – not only is the process easy for the customer, but it’s also easy for the sales executive, it frees up time, and customer satisfaction can be given a welcome boost too.

Dealers can be promised easy access to the product, and can be assured of the products’ competitiveness due to the firm’s vast distribution sales channels within the franchised dealer network. And that’s not to mention the firm’s experience in the motor industry as a whole.

Black Horse managing director Chris Sutton confirms that the new products were developed specifically with dealers in mind: ‘We have solid, two-way relationships with our dealers and we take on board what they say.

‘It’s been clear for some time now that dealers and their customers have been crying out for a flexible and hassle-free rental product where the costs are fixed, which very few of our competitors or manufacturers currently offer.

‘These new products slot in well alongside Black Horse’s already robust product portfolio, giving dealers and customers greater choice. As we already have a relationship with most large UK dealers, they will have quick and easy access to this product without having to look elsewhere.

‘I am confident our contract hire offerings will prove to be popular additions to dealer showrooms, with many private individuals opting out of company car schemes, due to limited vehicle choice and tax implications.

‘The change in the marketplace in recent years has seen interest grow towards the rental model, which is of course the norm in the US market.

When we identified this gap in the market we turned to our colleagues in Lex Autolease, who are the experts in their field.

‘Tapping into their vast knowledge and experience has enabled us to come up with a product that will truly have a positive impact for dealers and customers.’

Black Horse’s Personal Contract Hire and Contract Hire are both available now to Black Horse supporting dealers.

For more information call Black Horse on 02921 386338

Harratts dealer celebrates winning special award bit.ly/harrattsaward

‘‘

I am confident our contract hire offerings will prove to be popular additions to dealer showrooms.

Frequently Asked Questions on my new vehicle?

Q. How much VAT can I claim back 100% of the rental for business use, you can claim back A. If the vehicle you choose is solely partial business and package VAT. If your vehicle is for VAT and 100% of the maintenance maintenance of the rental VAT and 100% of the personal use, you can claim back 50% package VAT. for?

Q. How long can I have an agreement time after the your mileage and lease length at any A. 2-5 years with the option to change will affect up to six months before the end. Amends first six months of the contract and

COST

TAX EFFICIENT CHOICE

EFFICIENT MOTORING

your monthly rental repayments.

my agreement?

Q. How many miles can I have in depending on petrol 5,000 to 180,000 miles per year A. You can choose any amount from or diesel engines. maintenance package?

Q. What’s covered in the optional repairs not replacement tyres and any mechanical A. The package covers full servicing, required. even cover the cost of your MOT, if covered under warranty. We could of the agreement?

Q. Can I buy the vehicle at the end You can take out a hand the vehicle back at the end.

A. This is a rental agreement so you wish. new agreement on a new car if you the contract expires?

Q. What if I change my mind before rental cost. early, you pay just 50% of the remaining A. If you want to terminate the contract

Get on the road to your new car

The simpler route to your new business vehicle

today Ask your dealer about Contract Hire

by Lex Autolease Ltd. Finance is provided subject to status 1090741 Registered in England and Wales number London EC2V 7HN. Registered office: 25 Gresham Street, UK resident.

Applicants must be over 18 and a of the vehicle remains Indemnities may be required. Ownership must be handed back vehicle with the finance company and the at the end of the term.

21/07/2011 09:38 v1.indd 1-2

BHM114_contract-hire_business_

Frequently Asked Questions Q. How many miles can I have in my contract?

A. Choose any amount from 5,000 to 180,000 miles per year, depending on petrol or diesel engines.

Q. What if I want to change my mileage or the terms of my rental agreement?

A. You can make changes after the first 6 months of your agreement, or any time up until the last 6 months. Changes will affect your monthly rental amount.

CONTRACT

HIGHER

FIXED

FLEXIBILITY

Q. What’s covered in the optional maintenance package?

A. The package covers full servicing, replacement tyres and any mechanical repairs not covered under warranty. We could even cover the cost of your MOT, if required.

Q. Can I buy the vehicle at the end of the contract?

A. As this is a rental agreement you hand the vehicle back at the end of the agreement.

You can then take out a fresh agreement on a new car if you wish.

Q. What if I change my mind before the contract expires?

A. If you want to terminate the contract early, you pay just 50% of the remaining

rental cost.

Get on the road to your new car

Ask your dealer about Contract Hire today

Black Horse Personal Contract Hire Finance is provided subject to status by Lex Autolease Ltd. Registered in England and Wales number 1090741 Registered office: 25 Gresham Street, London EC2V 7HN. Applicants must be over 18 and a UK resident.

Indemnities may be required.

Ownership of the vehicle remains with the finance company and the vehicle must be handed back at the end of the term.

BHM114_contract-hire_consumer_v1.indd 1-2

The simple route to your new car

Black Horse has produced new marketing material to promote the two new products

20/07/2011 17:03

CarDealerMag.co.uk | 29

ENGINEERED FOR EXCELLENCE

As the UK’s No.1, Black Horse is more than just a point-of-sale finance company. With two industry awards under our belt already this year, we have a proven commitment to supporting motor dealers in new and innovative ways. The benefits of dealing with Black Horse include:

t

Superior online technology, for easier processing, quicker response times and fewer rejections

t

Dedicated, highly-skilled sales force with expert knowledge of motor industry requirements

t t

First-rate point-of-sale material and dealer support Approved Dealer Programme and Q-points rewards incentive scheme.

With all these resources in place, we’re looking forward to powering your sales now and in the future.

Call 02921 386338 for more details or visit

blackhorse.co.uk/motor

Finance available subject to status. Indemnities may be required. Black Horse Limited, St William House, Tresillian Terrace, Cardiff CF10 5BH.

big mike.

All Big Mike’s columns are on our website. Enjoy here bit.ly/bigmike

Music to my ears: A surprising offer from an ageing rocker

L

andmarks… we’ve all had them. Cars that have sat around on our lots long enough for them to almost become classics. It’s all too easy to get disillusioned with them, too – you take them in part-exchange, price them above the stand-in value and slowly watch your profit erode away into a loss as the thing gathers flat spots on its tyres and moss in the far reaches of Poo Corner, that little patch of Tarmac not visible from the front of your lot where the nasty old PXs always end up…

Most dealers will only keep a landmark for a fixed amount of time before cutting their losses and chucking the thing through the auction block. Others I know have even gone as far as to scrap the things out of spite – something you won’t catch Big Mike doing, partly because I’m a sentimental old fool who could never throw away a perfectly usable car, and partly because if there’s even a tiny little bit of money left in it, I like to extract back what I can.

Every dog has its day – the fact that there’s now an owners’ club for the Austin Montego is proof of that!

My most recent landmark was a 2003 Rover 75 1.8 Club in Pensioners’ Racing Gold. Not a bad spec, but the wrong engine, wrong colour and a car tainted by the fact that its manufacturer doesn’t exist any more. Normally, though, 75s have a bit of a following, especially in the West Midlands where I’m based.

They’re good cars, even a few years down the line, and if you get a well-specced diesel with either an auto box or evidence of a recent clutch change they’re good news. On the subject of the clutch, I’ll make car manufacturers’ insistence on using dual mass flywheels and their ability to write off otherwise decent cars a ft topic of a future column, once I’ve decided Big Mike managed to shi ld go in d an on the fate of an 04-plate Mondeo I’ve been one of these – an... stitched up with. too. He’s quite a salesm But I digress. The gold 75 was getting to the stage where it was deep into negative equity. Two years ago, I’d given £1,400 for it when the clean retail price was £1,995. I knew the colour and engine combo would knock it down a bit, but I had a little bit of money to play with – and those in my end of the trade, low margin, high turnover, £1k to £5k, know it’s always good to be a little ambitious, so up it went at £1,795.

Apart from the odd call, where the punter never got further than the colour (I can only

Big

mike Our man on the inside spills the beans on the car business...

assume they hadn’t quite deciphered what the letters G, O, L and D stood for in my ad), I had not a sniff. She’d been up on my lot at £1,195 (I took solace in the fact I’d taken advantage of the five months of remaining road tax by using it myself, so technically it wasn’t too bad a loss), I decided to take drastic action and reduce it to the price where all manner of odd-bod punters come out of the woodwork – £995. Once you’re under a grand, you open yourself up to all aspects of life, from hard-working family men and women to some of society’s less salubrious types.

As such, it came as no surprise to me when just a few days later, with the 75 once again freshly MoT’d, a fella with lank, greasy hair and a beard to match wandered onto my lot, dressed in ripped jeans and an Iron Maiden T-shirt that may have suited him 30 years ago, but certainly didn’t show him in the best of lights now he was in his 50s…

Nonetheless, he seemed genuinely interested in the

‘If there’s even a tiny bit of money left in a car, I like to extract back what I can.’ car, and after a cursory test drive where the only fault he could find was that ‘it wasn’t very rock and roll’, I got the impression the car had finally found its buyer (it’s a feeling beyond explanation, but you’ll all know it…!)

Clearly delighted that he’d found a car as serene and relaxing as the contents of his roll-ups, for a seemingly bargain price, I was a little surprised when the old rocker told me, a little bluntly, that while he liked the car a lot, he thought it was a bit pricey. Had I not been lost for words, I might even have told him to go forth and see if he could still multiply after a clearly chequered existence, but then he put his offer on the table – £1,000, or a fiver more than I’d put it up for in the ad.

Somewhat perplexed, I bit his hand off. He’d clearly seen the ad in the paper the week before I’d chopped the price down again, and had come to view it on that basis. The landmark Rover had finally found a buyer after all, but as I said before, every dog has its day...

Who is Big Mike?

Well, that would be telling. What we do know is he’s had 30 years in the car trade and picked up some seriously funny tales along the way.

CarDealerMag.co.uk | 31

forecourt.

Tony Whitehorn The managing director of Hyundai UK tells James Batchelor that the company’s sleek new i40 is a car designed in Europe for Europe Why is the i40 so important for Hyundai?

Simple – it embodies everything Hyundai is trying to do. We need to make our cars look fantastic and sleek, and the i40 saloon with its coupe-like lines and the dynamic shape of the tourer are representative of that. To be honest, up until about four years ago, we have not looked as good. The old Sonata was not exactly a good-looking car.

In a full year, how many i40s do you expect to sell?

To start off with, our expectations are around the 3,000 mark. It’s not crazy numbers but that’s what we think is about right. It’s a very important car for us as it gets us into the fleet market, and the initial ratio of sales we think will be 60:40 in favour of fleets. Like Mazda, we think it will grow to 70 in time.

Is the i40 a toe in the water in the D-segment market, or is it a complete offering?

The Koreans are not the type of people to build something to test the market – so the i40 is a proper competitor. We have invested an awful lot of money in advertising the i40 – actually, our marketing spend on the i40 is more than any other Hyundai ever – and that’s because we have said that we need a car designed in Europe for Europe. The Sonata was a different car, and if you compare the i40 with the Sonata, the i40 looks as though it is moving while it is standing still. And that’s what Europeans want.

Why has the tourer arrived first?

First of all we were given it!

But, secondly, if you were to ask me which one I would prefer to have first, it would be the tourer. And that’s for the simple reason that we will sell more tourers than saloons – at the moment we are saying 60:40 in favour of the tourer – and I believe it might even be 32 | CarDealerMag.co.uk

‘‘

more than that. The tourer has been met with really good reactions from fleets because they have appreciated the style associated with the tourer, and believe it is more stylish than many of the i40’s competitors.

There were fears the D-segment estate car was going to die out a few years ago. Do you think that’s changed?

Yes, definitely. I think what’s happened is that the mums who used to buy MPVs have realised that they don’t like driving them any more. But I also think there is a general move from MPVs back to estates because people now appreciate their practicality and their style. That’s shown by the number of estates in the D-segment increasing.

Does that mean we won’t be seeing more Hyundai MPVs in the future like the Trajet?

We currently do the ix20 and the large i800 as our MPVs. Do I think there is an opportunity for another MPV? There might be. I think the jury’s out on that because we currently haven’t got any plans to introduce anything in there. I think we need to concentrate on our two franchises: the volume cars – the i-range – and then the niche – Veloster, Santa Fe, and ix35 and ix20. We are trying to push that balanced model and from the dealers’ point of view that is great news as they have volume here and they have profit there.

The Koreans are not the type of people to build something to test the market.

Now is a great time to have a Hyundai franchise then?

Absolutely – we have people queuing up for it and we’re getting interest from people who are saying ‘we’d love to be with you guys’. But, for us, regional groups are very important. Regional groups have got local knowledge, but economies of scale, and have almost all of the benefits of an owner operator and almost all of the benefits of a big company.

themanual EQUIPMENT

All models boast excellent equipment levels. Heated steering wheel also features.

SPACE

Rear legroom has to be seen to be believed – it’s one of the class leaders.

NOSE

Hyundai i40 On paper Hyundai has got a new stylish and well-equipped D-segment car. But is it any good?

What is it?

What’s the spec like?

The i40 has an enormous task on its hands. Not only is the Korean firm pitching it against established D-segment cars like the Ford Mondeo and Vauxhall’s Insignia, but also the i40 is the car that is showcasing Hyundai’s new design and identity direction for a good few years to come.

A total of 3,000 i40s are expected to be sold in a full year, with fleet companies snapping up 60 per cent.

In-line with the i10, i20 and i30, the i40 comes with very decent levels of standard kit. Even the entry-level 1.6-litre Classic comes with 16-inch alloys, air con, Bluetooth with voice recognition, heated door mirrors and electronic parking brake – priced at £18,395. Prices top out at £25,895 for the 134bhp 1.7-litre Premium, but the best-seller is expected to be the 1.7-litre Style.

What’s under the bonnet?

What’s it like to drive?

Two petrols and one diesel in two different power outputs. The 133bhp, 1.6-litre ‘Blue’ petrol is satisfactory at cruising speeds but it’s loud and boomy in all other environments, and a 2.0-litre petrol arrives later. The eco ‘Blue’ badge is also attached to the low-output 114bhp 1.7-litre diesel while the high output 134bhp will be the top-seller. The 114bhp is the best all-rounder.

Our overriding impression of the i40 is one of refinement. The cabin is full of neatly-styled, good-quality plastics, and coupled with good sound-proofing the i40 is a relaxing car to pilot. The nicely-damped chassis does introduce body roll but the car never feels flustered and is rather surefooted. We feel the Blue model is the best all-rounder with decent power and excellent fuel economy.

What do the press say?

Auto Trader said it’s ‘a smart and reliable estate, with high equipment levels and a comfortable ride’.

Autocar felt it sits in the ‘upper half of the class’ but the car’s dynamics let it down a bit. Meanwhile Honest John believed the i40 shows how far Hyundai has come in the last 10 years adding ‘it looks a winner’. The Independent said they ‘can’t see how it can possibly fail’.

What do we think of it?

Hyundai have had a crack at the Dsegment before – remember the Sonata? – but with generally poor outcomes. The i40 shows the Korean firm is really beginning to understand the wishes of European buyers. It’s no Mondeo beater in the handling department, but we wouldn’t be surprised if the i40 steals sales away from Renault, Citroen and Vauxhall.

i40 features firm’s new design details such as hexagonal grille, LED lights.

the knowledge Model: Hyundai i40 Tourer Style Price: £21,850 (tested), range from £18,395 Engine: 1.7-litre, diesel Power: 138bhp, 325Nm Max speed: 118mph 0-60mph: 11.8s MPG (comb’d): 62.98 Emissions: 134g/km Residual values (three years): 30 per cent.

target buyers: A 60:40 split in favour of fleet buyers. Tourer could even outsell saloon variant.

the rivals:

Ford Mondeo, Vauxhall Insignia, Volkswagen Passat.

Key Selling Points: 1. i40 is the first Hyundai to really show off ‘fluidic sculpture’ design to the full.

2. It’s refined with good build quality, and handles neatly.

3. Excellent equipment levels and acres of rear legroom.

Deal Clincher: Offers the lowest CO2 figure of 113g/km and BIK cost in class.

CarDealerMag.co.uk | 33

forecourt.

Jon Williams

Managing director of Toyota GB has high praise for his network of hard-working dealers . . . and says the new Yaris is a crucial car for the UK How is Toyota coping with supply problems?

They have been and gone. We’ve had an amazing recovery. We’ve been at full capacity for Europe since June with every plant at 100 per cent, and we have recently published a press release which shows that Toyota Motor Corporation is back at pre-earthquake levels and looking to catch back 350,000 units in the balance of our financial year.

We’re in a good position.

How important is the Yaris being a European car and built in Europe?

Very – it’s a small car built in France, which gives a real opportunity because we have cost competitiveness in local manufacturing, and we have that flexibility in that we work off late ordering. Having a plant in Europe also means we have a short supply chain from the north of France – in fact it’s little different from working in the UK – and it means we can be very customerorientated and we can give customers what they want, when they want it, and at the price they want it. We will also be building the Yaris hybrid there meaning we produce two hybrids locally and this is very much in the vein of the Toyota model.

So, Yaris is an important car for your network...

The Yaris is a hugely important car for the UK as it is our best-selling model, and in terms of the number of vehicles still on the road since 1999, there’s around 300,000. For our dealers, this is an important car.

How many units of the Yaris do you expect to sell?

In a full year – with the hybrid – we aim to sell in the high 20,000s. I think that is a good expectation figure given where the marketplace is – don’t forget, in the past, we would see around 34,000 Yaris units a year. With new entries into the B-segment market, our expectations are not back to 30,000+ units, but with the hybrid at 20 per cent mix, I think a figure in the high 20,000s is very achievable.

‘‘

You say the new Yaris has ‘grown up’ but you’re also targeting younger buyers.

Is there a danger of the two contradicting each other?

When we launched Yaris in ’99, it was our only small car. Now we 34 | CarDealerMag.co.uk

have Aygo, iQ, Yaris, Verso-S, and Urban Cruiser – that’s five small cars. What we mean by grown up is that it’s really become a full B-segment car.

When the Yaris started off, it was somewhere between A and B-segment, and even the last generation Yaris could have been accused of being A+ or B- in terms of sizing. Younger buyers want to buy full B-segment cars.

With greater sector designation for models, is this good news for your dealers?

Our dealer network can now sell a full line-up of small cars, and this is really important in terms of where the market is going. It also fits very strongly with Toyota’s heritage – in Japan, Toyota has a history of producing many small cars for buyers.

We have done a large amount of hard work in improving customer retention.

With your rivals opting for eco-petrols, why has the Yaris got a diesel engine?

It’s about offering our customers what they want.

A small proportion of our customers require a diesel for long motorway journeys and that is what we offer. We don’t expect it to take a huge mix – the 1.33-litre version will be the biggest seller – but we see there will be a big opportunity for the Yaris hybrid.

How’s your dealer network at the moment?

They’ve had a tough year as 2011 will be the lowest retail market in 20 years. My constant advice to them is to work hard because if you work hard and you are disciplined, you can still perform – and I see that from our network. At the half-way point of this year it is profitable, although on average it is behind where we were last year. That was 1.79 per cent return on sales – and I think we will struggle to meet that, but the conditions are different. We are seeing good signs from our network – as I have mentioned it’s profitable and we have done a large amount of hard work in improving customer retention and service, and in used cars. Our network is fighting hard and I am proud of them.

themanual STYLING

TECHNOLOGY

High belt-line and Y-shaped nose are successfully carried over from predecessors.

Interior is now far more sober compared to old models, but new car features Toyota’s clever Touch and Go system

POWERTRAIN

Two petrols and a diesel are on offer giving buyers flexibility. Hybrid version arrives in 2012.

Toyota Yaris The new Yaris arrives facing even more competition in the B-segment. James Batchelor has driven it What is it?

What’s the spec like?

This is the third generation of Toyota’s B-segment supermini – a car that first debuted in showrooms back in 1999.

Toyota say it has grown up – and we’re inclined to agree. In come more distinguished looks with some big car equipment, but out goes the speedo in a tunnel on top of the dash.

Cleverly though, the new Yaris is only 100mm longer than the outgoing version and inherits the old models’ feelings of space.

Four trims: T2, TR, the mildly sporty SR, and T Spirit. Prices start at £11,170 for the T2 three-door 1.0-litre manual, and rise to £15,385 for the T-Spirit five-door 1.33-litre with Multidrive S. The best seller is expected to be the £13,260 TR with the 1.33-litre unit which has 15-inch alloys and air con.

Toyota Touch and Go – a multimedia package – is standard on TR, SR and T-Spirt for the first six months on sale – then available as an option.

What do the press think of it?

What’s under the bonnet?

What’s it like to drive?

What do we think of it?

UK buyers will have a choice of three engines – a 68bhp 1.0-litre petrol and a 1.33-litre petrol – available in manual and CVT – that develops 98bhp, and an 89bhp 1.4-litre diesel. We could only try the 1.33-litre unit at launch.

It feels relatively zesty and is capable of 55.4mpg with the Multidrive S CVT ’box, while emitting 118g/km of CO2. A hybrid version arrives next year.

As we said, we could only try the 1.33-litre engine and feelings are mixed. With the six-speed manual it’s easy and relaxing to pilot but unmemorable, while the CVT version is thrashy and uncomfortable. The ride is a little unsettled over uneven roads, but the steering is adequately direct and the brakes are sharp. It’s a car that presents few surprises – exactly what most customers require.

There’s no doubting where the new Yaris has got its looks from – note the Y-shaped grille and steeply raked belt line from previous versions.

The new car handles better and is a more complete offering in the specification department, but a bit of its predecessor’s sparkle has been lost in this third version. However, while we might regret that, many buyers won’t notice.

Autoblog UK agreed the Yaris lacked Fiesta-like drive but thought it was ‘a big improvement over the outgoing car’. The Independent said ‘the spark of individuality has deserted it… next to the iQ the Yaris seems a bit half-hearted’. Honest John admired the new car’s generous interior space, but felt the looks were ‘rather generic’ and the design ‘not especially distinctive’.

the knowledge Model: Toyota Yaris TR Multidrive S Price: £14,680 (tested), range from £11,170 Engine: 1.33-litre, petrol Power: 98bhp, 125Nm Max speed: 109mph 0-60mph: 12.3s MPG (comb’d): 55.4 Emissions: 118g/km Residual values (three years): 40 per cent

target buyers: Toyota say younger buyers but we feel many loyal Yaris customers will be swapping their old model for this.

the rivals: Ford Fiesta, Vauxhall Corsa, Volkswagen Polo.

Key Selling Points: 1. A range of engine options.

2. The new car successfully carries over the old Yaris’ attention to interior space.

3. Yaris is now full B-segment and sits in a five-car-strong Toyota small car range.

Deal Clincher: Toyota’s Touch and Go system is one of the best multimedia systems on the market.

CarDealerMag.co.uk | 35

forecourt. the knowledge Model: Infinity M35h Price: £46,840 Engine: 3.5-litre V6, plus electric motor Power: 359bhp, combined 620Nm Max speed: 155mph 0-60mph: 5.5s MPG: 40.4 Emissions: 162g/km Residual values (three years): 32 per cent.

target buyers: Corporate buyers with a keen eye for economy.

the rivals: BMW 5 GT, Mercedes E Class.

Key Selling Points:

1. Performance.

2. Exclusivity of something a little different.

3. Level and quality of equipment.

Deal Clincher: Performance and economy combined.

Infiniti M35h

Infiniti’s latest model is the world’s fastest-accelerating hybrid car on sale today. Duncan Chappell gives it a go What is it?

and quiet. In eco mode, the throttle is over dampened to breed fuel-sipping driving. We found it a bit annoying.

Yes, it’s another hybrid, but this one’s a little different. It sprints from 0-60mph in 5.5 seconds and is a refreshing take on the larger executive car, focusing on performance and economics.

What’s under the bonnet?

Lots! There is a 3.5 litre V6 producing 292bhp combined with an electric motor that dispenses a further 67bhp.

The end result is 359bhp and a lot of punch. As we’ve said, it is the fastest accelerating hybrid saloon on sale.

What’s the spec like?

There’s only one – GT Premium. This

What do the press think of it?

gives the buyer a top-quality Bose sound system, sat nav, leather, adaptive cruise control, heated seats and ‘white ash wood with silver finish’ – all for £46,840.

What’s it like to drive?

Like Duncan Goodhew running through a graveyard. Smooth, quick

Autocar.co.uk said it was ‘a decent car… but short on ultimate beauty’. Auto Express added: ‘If you’re in the market for an M, this is the one to go for’.

What do we think of it?

Infiniti offers a real contender in the exec category, and with this hybrid, customers (mostly fleet) will manage better running costs. It does look a little like a late 90s Hyundai outside, but the inside is a great place to be.

Unlock your potential

36 | CarDealerMag.co.uk

themanual

Vauxhall Insignia

the knowledge

Efficiency and simplicity are the watchwords for the petrol version of Vauxhall’s saloon, reports Duncan Chappell What is it?

depending on the spec, it will keep the driver entertained for a little longer than a cardboard box.

A technological upgrade for Vauxhall’s saloon. A new engine, some more gadgets and uprated sat nav and a new colour – blue.

So not a great deal.

What do the press think of it?

What’s under the bonnet?

The new powertrain on test here is the 1.4-litre Turbo. This is to replace the existing 1.8-litre and continue Vauxhall’s quest for green motoring.

What’s the spec like?

Since its launch, the Insignia has boasted a pretty good spec all round.

With new tech and revised options, prices range from ÂŁ17,970 for the ES to ÂŁ35,780 for an Elite with most of the goodies. A new SD card sat nav

$'9(57 QHZ ORRN 35,17 LQGG

unit, lane departure warning, traffic collision prevention and traffic sign recognition also feature.

What’s it like to drive?

About the same as the outgoing 1.8. It goes from A to B with no fuss or drama at all. The 1.4 Turbo is lacking in the excitement area, but,

MSNcars.co.uk say: ‘As an affordable medium-range family car for people who aren’t too bothered about handling sharpness, it does the trick.’

What do we think of it?

Vauxhall have sold more than 105,000 Insignias in the UK since its launch in 2009, and with around 70 per cent of them being diesel (mostly fleet) it is great they now offer a petrol engine with similar efficiency. A decent, no nonsense car.

Model: Vauxhall Insignia Price: ÂŁ25,020 (as tested), range from ÂŁ17,970 Engine: 1.4-litre turbo petrol Power: 138bhp Max speed: 127mph 0-60: 10.1s MPG: 47.9 Emissions: 139/km Residual values: TBA

target buyers: Fleet and retail buyers that don’t want a diesel.

the rivals:

Mondeo. BMW 3 Series, Audi A4.

Key Selling Points: 1. Low emissions but not a diesel.

2. Build quality to rival the Germans’.

3. Eco-friendly petrol engine.

Deal Clincher: High level of spec for comparatively low price.

CarDealerMag.co.uk | 37

forecourt. the knowledge Model: Volkswagen Jetta SE Price: £21,650 (tested), range from £16,965 Engine: 2.0-litre, diesel Power: 138bhp, 320Nm Max speed: 130mph 0-60mph: 9.3s MPG (comb’d): 53.3 Emissions: 138g/km Residual values (three years): 31 per cent

Volkswagen Jetta

The new Jetta aims to be more grown up and lose the ‘Golf with a boot’ tag. James Batchelor reports What is it?

the rivals:

Previous saloon Golfs have had a fair crack at shaking off the ‘Golf with a boot’ description. This new Jetta aims to consign that description to the history books once and for all by taking on the persona of a mini-Passat.

Key Selling Points:

What’s under the bonnet?

target buyers: Mostly fleets and company car drivers.

Volvo S40, Skoda Octavia, Peugeot 508.

1. More practical than hatchback brother.

2. Equipment tried and tested on other VWs. 3. Interior really rather good.

There’s one petrol, a 1.4-litre TSI unit in 120bhp and 158bhp forms, and two diesels: a 104bhp 1.6-litre BlueMotion and a 138bhp, 2.0-litre unit.

Deal Clincher: Caters for a neglected area of the market.

What’s the spec like?

38 | CarDealerMag.co.uk

The range begins with the S model at

and refinement, just very little excitement. The 2.0-litre diesel is the best all-rounder.

What do the press think of it?

£16,965 which comes with air con, an alarm and a four-speaker radio.

The range tops out at £22,530 for the Sport which adds 17-inch alloys and a multifunction steering wheel.

What’s it like to drive?

Despite its associations with the Golf, the good news is that it drives like a Passat. That means decent handling

Autocar feel that if buyers want a more practical Golf, the Jetta is the answer and the only real reason for buying one. Top Gear said they’d rather plump for a Golf and put up with less practicality.

What do we think of it?

It’s tricky – buyers will opt for the Jetta because they want a more practical Golf, but it’s not as good as a Golf. There’s very little to inspire ownership of the Jetta and for that reason we’d rather go for the Passat.

themanual

Alfa Giulietta JTDm-2 140 Alfa Romeo at last have a mid-range diesel engine for their hatchback model. Is it any good? James Batchelor finds out What is it?

just a shame about the intrusive diesel clatter, and ambitious 62.8mpg figure – we managed 49mpg. We think the grippy and highly-composed chassis is super, though.

This is an important engine for the Giulietta as it hurls the Italian firm into the mid-spec diesel market for hatchbacks – a crucial sector Alfa Romeo wants to compete in. It aims to balance fuel economy with performance.

What do the press think of it?

What’s under the bonnet?

This diesel sits between the 105bhp 1.6-litre JTDm, and the big daddy of the black pump range, the 170bhp 2.0-litre JTDm. It packs 140bhp and a more-than-healthy 320Nm of torque to propel the car to 62mph in 8.8s and onto 127mph. It emits only 119g/km.

What’s the spec like?

Autocar felt that by sticking to the motorways, the Giulietta is ‘a worthy Lusso at £20,750 boasting 16-inch enough alternative to the Focus’ alloys, Blue&Me and climate control although What Car? said that they’d and rises to £20,050 for the Veloce rather plump for the cheaper 1.6-litre that has leather and lots of aluminum diesel version. trim. All have Alfa’s DNA system.

What’s it like to drive?

The JTDm-2 140 range kicks off with

It’s a decent effort from Alfa and is a welcome addition to the range. It’s

the knowledge Model: Alfa Romeo 2.0-litre JTDm-2 140 Price: £24,180 (tested), range from £20,750 Engine: 2.0-litre, diesel Power: 140bhp, 320Nm Max speed: 127mph 0-60mph: 8.8s MPG (comb’d): 62.8 Emissions: 119g/km Residual values (three years): 35 per cent

target buyers: Predominantly company car drivers and fleets.

the rivals:

Ford Focus, Citroen DS4, BMW 1 Series.

Key Selling Points:

What do we think of it?

1. Pretty design features.

2. Company car buyers can now have a diesel Alfa with all-round abilities.

3. A great, grippy chassis.

We’re fans of the Giulietta and this engine is a welcome addition to an already strong product line-up.

Deal Clincher: It only emits 119g/km.

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CarDealerMag.co.uk | 39

FEATURE.

Swinging

sixties

James Batchelor catches the midnight express to one of the UK’s busiest dealers to witness 61-reg handover day which started at... 12am!

I

t’s 21:30 and in two-and-a-half hours’ time, 52 brand new Fords will ease on to Ripple Road in Barking bearing two new digits on their number plates.

These cars and their drivers will be the first in the surrounding area to have ‘61’ gracing their reflective plastic plates, making other road users owning ‘11’ registered cars just so unfashionable.

However, until that moment, there’s a lot of preparation work to be done. General manager of Dagenham Motors Barking, Howard Clifforth, is the man who is responsible for the evening, and he’s feeling the pressure.

‘I’m not what you’d call relaxed,’ says Clifforth, ‘I’m a little anxious to tell the truth.’

Any minute now, customers desperate to get their hands on their newly-registered Fords will be arriving. And they’ll be leaving at the dot of midnight in convoy out of the dealership’s gates and into the world of new car ownership.

As Clifforth chats to me, his staff are organising the last bits of paperwork, sorting out the keys into buckets and laying out tables laden with drinks and snacks.

Impressively, every one of Clifforth’s team is here including the valeters and service staff.

That’s because there has to be a very quick turnaround – and by quick, I really do mean quick.

As soon as the customers drive on to the site, their old car is taken away and they are directed towards the showroom. While the customers are signing on the dotted lines, their old vehicles are immediately driven into the service bays, checked, prepped and prepared.

‘The service staff will work through the night until business opens tomorrow morning,’ says Mark Scammell, used car sales manager.

‘We have also got a team of guys uploading the cars’ details so these used cars can go online tomorrow with no delay. It’s a hectic turnaround, but we’re used to it.’

40 | CarDealerMag.co.uk

One of those cars that is getting the full Dagenham turnaround treatment is a Focus belonging to Jean Vincent. She’s part-exchanged it for a brand new model boasting some exciting new technology, and it’s her third midnight collection.

Meanwhile, on the other side of the dealership in the customer waiting area sit Mr and Mrs Webb. They’re on to their fifth Ford from Dagenham Motors Barking and their whole family is Dagenham Ford-mad. ‘We wouldn’t go anywhere else,’ says Mrs Webb. ‘We feel like part of the family here – we’re always bringing in cake and sticky buns to the staff to show our gratitude.’

Tonight, Mrs Webb has brought with her an expensive box of chocolates for the dealership’s

business manager Paula Harmel. Through the sales executives’ number crunching and her hard work, Harmel is able to deliver stunning deals for the dealership’s many customers, especially Mr and Mrs Webb.

‘In the case of Mr and Mrs Webb,’ says Harmel, ‘we’ve managed to get them into a brand new Ford Focus with a free Titanium pack for £60 per month less than they were originally paying. It’s great when deals work out like that – plus the chocolates are nice too.’

In fact, it’s deals like Mr and Mrs Webb’s that have helped tonight’s midnight handover actually happen. There was a point at the beginning of August, Clifforth tells me, in which he had firmly

‘‘

Marketing from Ford and ourselves in promoting deals has created a buzz around 61 regs.

written off the idea of the special handover event taking place – not enough customers wanting to collect a new-reg car made the event impractical to put on. ‘However, recent new marketing from Ford and ourselves in promoting deals has created more of a buzz around the 61 registration, and that’s what has changed.’

A buzz around the new number plate is something that Ford of Britain’s new sales director Andy Barratt is under no illusions about. A few hours before, I managed to have a chat with the newly-appointed director, and he’s sure that there is still keen interest in plate-change time from consumers. ‘We’re looking at the early figures for September and they show there is an interest from

buyers in the new number plate,’ he says. ‘March will always be the biggest of the two months because it is a more significant plate change, but there’s still a buzz around September. That’s because customers always like newness and September gives them a chance to get something new.’

Despite March and September being the hottest months of the year for new car sales, Barratt is happy with the number of buyers opting for Fords this year. ‘It’s an interesting and challenging marketplace for sure, and for everyone who is spending their own or a company’s money, they are all watching the pennies,’ he says. ‘But they are all looking for the same things – and that’s value, trust, reliability and

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FEATURE.

The site was extremely busy all night

52 new car buyers picked up their cars

Batch witnessed the entire 61-reg party

Fiestas made up a large proportion of sales

A customer signs for his new 61-reg motor

The only time Batch will see a chequered flag

accessibility. Ford is the ideal brand to match those things buyers are looking for. We have got a history for value for money and for being a trusted brand, we have the best product range in our history at the moment, and we’re 100 years old – everything is coming together.’

Those aren’t hollow words. One look at the SMMT’s monthly registration figures will show that Ford can virtually do no wrong in the car market at the moment.

‘As the sales director, I have to remain paranoid, quite frankly,’ says a serious Barratt.

One month into the job he comes from the aftersales side of the business, and by having a sales background the transition has been smooth, prompting Barratt to describe is as ‘like coming home really, it feels very familiar’.

Barratt’s first month has already seen Ford beat its internal objectives for the number of new cars sold by quite some margin, but that’s still no cause for complacency.

‘We’re always as good as our product and as good as the interactions our dealers have with our customers,’ explains Barratt. ‘Consequently, we work very hard to make sure we’ve got the very best product line-up, we’ve got enough of that product to satisfy market demand, and also that our dealers are presenting that product in the right way. It’s hard work and we can’t afford to be complacent, but that is why we have been successful for so long.’

Ford really is a successful brand in Britain. The

Dagenham ford

History lesson Under the helm of Howard Clifforth, this dealership bears an important name in Ford’s history. Originally owned by Ford themselves, the dealership in Dagenham was built in 1938 and was one of the Blue Oval’s most modern.

After surviving the bombing of WW2, the business was sold to Reynold’s Motors in the 1970s and the Dagenham Motors name was consigned to the history books. However, in 1981 Ford bought the name for £1, and within 10 years two sites had developed into 20.

The business came full circle in 2004 after the Polar Motors Group – a joint venture between Jardine Motors and Ford – bought Dagenham Motors in 1999 and then Ford bought the remaining stake in Polar in 2004, meaning Dagenham Motors once again came under the ownership of Ford.

Blue Oval has had a tight grip on the number one spot in the new car market for 35 years, and for nearly 45 years as LCV market leader. It’s been here for 100 years, and has built approximately 26.5m cars in the UK in that time, and there’s still around four million traveling around on the roads all over the country.

‘We have touched most people in the UK, and there are more than 100,000 people employed

directly or indirectly by Ford in the UK – and that’s an important part of our economy,’ says Barratt. ‘That’s also 100,000 families that are dependent upon us selling cars in the UK, and that is a big responsibility for the company. When you have got all of that history, there’s a lot of love and affinity with the brand which is great. This always gives us a solid platform to build upon.’

But Barratt does not wear rose-tinted spectacles.

While it is true that Ford are proud of their history and of their place in many of British people’s lives, they are sensible in understanding their buyers’ attitudes.

‘For many years, Ford has been voted Britain’s most trusted automotive brand by the public and by car buyers,’ explains Barratt. ‘But that won’t necessarily make someone go out and buy a car today. What it does do, though, is give the public that constant reassurance that we are here to stay, we are here for tomorrow, and we will continue to invest and support everything in Britain.’

One of those dealers that have ably contributed to Ford’s 100 years in the UK is Dagenham Motors. The Barking site embodies much of what Barrett sees in Ford’s position in the UK marketplace. The name might be old – Dagenham Motors stretches back to 1938 – but it is one of the firm’s most forward-looking dealerships in the country. Since its relocation to this new site in 2008, it now features many technologies that some manufacturers and dealerships are only just installing.

CarDealerMag.co.uk| 43

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FEATURE. The site, for instance, has a 30m high wind turbine that produces five per cent of its electricity, a rain water harvester and a central heating system which runs on waste engine oil.

‘We’re still quite unique in the UK for having a two-tier dealer network – we have a main dealer network which is around 200 and we have around 350 retail dealers which are franchised through the dealer – and that works for us,’ says Barratt.

‘It does mean that the customer is never very far from a Ford dealer – and that is a key Ford principle in that the customer is always looked after once they have bought a Ford.’

Two customers who have always been looked after by the brand are Mr and Mrs Bhatt. They’ve been buying cars from the Blue Oval since 1989, and with the help of sales executive Keith Motram, they’re handing over their Ka and putting their signature next to a brand new Fiesta.

It’s a scenario that is being repeated all around the dealership, as the final customers are being shown out to their new motors. The 52 cars that will be driven away tonight are all arranged in groups specific to the sales executives.

One salesman is handing over only Focuses; another, a selection of Fiestas, Focuses and a Ka – but all are busy showing their customers around the cars. Conversations on how to use the voice-activated Bluetooth and a reminder that this particular car is a diesel or a petrol are being repeated all around the site.

Amid all this, the part-exchanged cars are still being shuffled into the workshop area. Some are only six months old while others bear a 10 on their number plates, but all are being put under the same microscope. It’s here where you see the whole car ownership process – the emotions of handing over a part-exchange, to the euphoria of taking away a new car. The customer comes in with one and drives out with another, while their old car makes its way onto the used forecourt for another person to enjoy.

With 10 minutes to go before midnight, the cars make their way to the exit and line-up

At first, Dagenham Motors were worried their traditional midnight handover wouldn’t happen – not enough buyers were interested in 61-reg models at first in convoy. Clifforth hands me and another salesman a chequered flag each. ‘It’s a bit of a tradition here,’ says Clifforth. ‘We want to top the evening’s special feeling by waving our customers goodbye. We’ll wave them off with a chequered flag – but we won’t bother with a Le Mans start!’

A quick check of his watch, and Clifforth gives the word – it’s midnight. At the head of the convoy is a Ford Focus driven by one of Ford’s Dagenham Diesel Centre workers. He’s on his tea break and is in a rush. He’s followed by the other

51 new cars which, with it now being officially September 1, are fully legal drive on to the public highways.

Other motorists stop on the surprisingly busy Ripple Road to see what all of the fuss is about.

Within minutes, weeks of hard work have gone before the dealership staff’s eyes. The hard work continues tomorrow as a further 21 cars will be handed over, but under more normal circumstances. That can wait though – as now, for the sales people, it’s time for bed. [CD]

Debt, not 61-reg, a priority

Buyers more likely to slash bills than shell out on new car, says The AA CAR buyers are more likely to pay off debt than shell out on a new 61-plate vehicle this month, according to a survey. Research by AA Financial Services reveals potential purchasers are less likely to buy a new car and are instead choosing to hang on to their current motors for longer.

And in a double blow for dealers the survey says that even if they do buy another car, buyers will spend less than they would have done 12 months ago on it and pay for it using savings rather than lucrative in-showroom finance.

‘The survey suggests that new car sales are likely to remain depressed,’ explained Mark Huggins, director of AA Financial Services. ‘Only a third of respondents plan to change their car within the next

24 months, less than a fifth of them intending to buy a brand new one. Seeing a shiny 61-plate car on the drive is a dream for most families when they have more pressing concerns, so they are hanging on to their cars a bit longer.’

Huggins said that the research shows a third will only pay between £5,000 and £10,000 on their next car – if they do decide to buy – with more looking for under the £5k mark instead. And he added the number of people who would consider taking out a loan to pay for a car has dropped from 20 per cent to just 11 per cent in the last two years.

Daksh Gupta, chief executive of Marshall Motor Group – the 11th biggest dealer group in the UK – said: ‘Whilst we would agree many motorists are

experiencing a period of prolonged economic challenge, our experience does not reflect the tone of the AA statement.’

Paul Everitt, chief executive of the SMMT, added: ‘September is an important month for the UK motor industry and motorists will find a lot to interest them at their local dealer.’

Meanwhile, Paul Harrison, head of motor finance for the FLA, also questioned the statistics. ‘FLA members’ share of the new car dealer finance market is at a two-year high of 57 per cent,’ he said. ‘There are many incentives available to consumers to buy new. That said, economic conditions have affected buying behaviour with more turning to used cars.’

SMMT Sales Figures for August, p81 CarDealerMag.co.uk| 45

FEATURE.

Seventh

heaven If there’s one car that’s transformed Kia’s fortunes it’s the new Sportage. We travel to Slovakia to see the 7,000th UK car built and find out the secret behind its success. James Batchelor reports

S

emptember 7 was a big day for the Kia Sportage in the UK. That’s because the 7,000th car, complete with its obligatory seven-year warranty, was delivered. It marked an extraordinary journey for the firm who, in the space of 12 months, have helped changed their image from the maker of value-formoney motors, into a car company that can build a stylish car to rival some of the most established names in the business.

The Sportage has not only done its bit in transforming the company that builds it, but it has created a template for all successive Kias to follow. The changing fortunes of the Korean firm means the dealers who rode through the unfashionable days are now laughing all the way to the bank – and there are many more joining a long queue to get hold of the franchise.

To celebrate this ground-breaking Kia, Car Dealer headed to the factory that builds it, in Slovakia, to watch the 7,000th car created. We’ve also spoken to Kia UK boss Michael Cole and the dealer principal of Kia Bolton to find out what it’s like selling such a pioneering car.

COVERED

Bragging about your cars now having a longer warranty than your competitors’ seems to be the height of fashion. Last year we saw one Japanese

firm introduce a five-year, 100,000-mile warranty as standard across its range. Soon after a British firm went a few steps further by introducing a warranty that lasts a lifetime. Arguably the first to realise a good warranty is key for UK car buyers was Kia. It has been providing a warranty that covers 100,000 miles and lasts for seven years since 2006 – and January of last year saw it rolled out across the entire model range.

The first Kia which came with the then industry-leading warranty was the Cee’d, a car which started to reverse Kia’s fortunes and began to show Europe that the brand could produce a well-built, attractively styled and keenly priced competitor in the all-important C-segment.

It was – and still is – an important car for the Korean firm who cannily realised that one of the best ways of convincing Europeans to buy Kias was not only to hone the car’s handling characteristics on European roads, but also to build the car in Europe.

A 410-acre site, deep in the mountains of Zilina, north west Slovakia, was chosen for a brand new factory to build a new range of Kias which would transform the brand. The ground was broken in April 2004, construction began in October of that year, and by December 2006 production in large volumes began. In essence it’s the home of the seven-year warranty.

01

03

02 Steel arrives on large rolls and waits to be pressed into various body panels for Sportage, Cee’d family and the Venga 46 | CarDealerMag.co.uk

Sheets are punched into recognisable parts of a Sportage – one panel can be pressed every 20 seconds

Up to 7,000 panels can be kept in a giant Airfix-like storage system which takes up a huge section of the factory

‘The Cee’d having the seven-year warranty from launch was a real message about quality and reliability and of the standard of product coming out of our European factory,’ Kia Motors UK managing director Michael Cole explains.

‘The UK wasn’t the creator of the seven-year warranty – it was something which we wanted to have. But we pushed hard for it to be extended to the whole range because we knew the benefit it would bring to our sales.’

The extension of the warranty to all models in January 2010 was helpful as it conveniently formed part of Kia’s exit strategy from the scrappage scheme. ‘We also had that message out there that here is a car company that is giving its buyers seven years of warranty – that is a confident car company,’ added Cole.

There’s no doubt that Kia could not have adopted such a confident stance with the sevenyear warranty without a state-of-the-art factory in Zilina. The plant is the workplace for more than 3,000 employees who have helped build some 730,000 Kias since 2006. Along with the Cee’d and, from October, Venga, the Zilina factory also produces the Sportage.

Last year 90,000 Sportages were made at the plant, and with the all-new model penned by ex-Audi design chief Peter Schreyer launched last year, Kia is quickly reaching major production milestones. One of those is the 7,000th model for the UK. This special car’s build process starts in the press shop where the major outer and inner panels are made. Large rolls of steel are processed in pressing machines which work tirelessly punching and churning out what were flat sheets of metal into recognisable car parts.

One panel can be pressed in just 20 seconds, and Kia’s astonishing attention to detail begins here with the panels checked by a 3D optical inspection process. Afterwards the panels are stored in an enormous Homebase-like shelving system which can house up to 7,000 panels. A dance between fork-lift trucks and a robot ensure they are stored quickly with minimal effort.

The next destination for our 7,000th Sportage is the bodyshop. It’s here where the Sportage starts to take on the look of

04

06

05 The partially complete steel bodies make their way into the bodyshop via conveyor belts

Different parts such as the Sportage’s floor, sides and roof are all welded together by more than 300 robots

From the bodyshop, the Kias begin their journey to the painters. Here they are waiting in line for their special treatment CarDealerMag.co.uk| 47

FEATURE. 07

Located over three floors, the cars are treated to a five-step paint process including a 360-degree dip

10

08

The big bake-off: After the dip, the Kias are baked to 180oC to seal the paint. It’s then waxed and buffed

11

The running gear is attached. More than 1,100 workers, on two shifts, beaver away putting the models together

The engines arrive from another part of the factory and are installed here. Then the interior is finished

an actual car, and the Schreyer-designed lines, gorgeous in bare steel, are revealed as a whole for the first time.

Different parts such as the Sportage’s floor, side structure and roof are all welded together by more than 300 robots, each one carrying identical spot welds. The production line can cater for eight different models but currently deals with five.

Sat in front of the Sportage and amid a shower of sparks sits a Cee’d SW, and behind a Pro-cee’d.

The robots can distinguish between the Cee’d family, the Sportage and, within time, the Venga.

The welded steel bodies are next transported to the paint shop, located over three floors. The Sportage is treated to a pre-treatment process, an electrochemical coating, a sealer and deadener, a primer coat, and a top coat. A 360-degree dipping process ensures the whole car is treated and painted, then an inspection and a wax follows.

‘Painting a car sounds an easy process,’ says the plant’s spokesman Dusan Dvorak, ‘but 10 different colours can be applied to the Sportage, and each car travels 4.6 miles by a conveyor belt in the paint shop alone.’

The Kias are then stored to dry out. Again it’s another DIY store-like storage system where 140 bodies can be placed to dry. ‘It has to be a speedy process,’ says Dvorak. ‘140 drying places quickly fill up.’

The painted Sportages, now adorned in their customers’ colour choices, then make their way across a glass-walled tunnel into the assembly

shop. The 7,000th Sportage, finished in Arctic White, waits with others destined for left-hand drive countries.

All doors are removed and are taken away by more robots. ‘It makes the workers’ jobs easier to do it with the doors out of the way,’ explains Dvorak.

The doors will be reunited with the cars later.

The running gear is the first to be attached. More than 1,100 workers, on two shifts, are beavering away adding the suspension arms to Cee’d platforms and braking systems to Sportages.

Via tracks, the engines are delivered. They’ve come from the adjacent engine shop. Like the car production line, there’s five production lines in the engine shop – four cutting lines and an assembly line. Two petrol engines and three diesels are made there – but you wouldn’t know it. It has one of the cleanest floors in the world.

The Sportage body is then taken along a series of tracks high above the workers’ heads and lowered just in time to meet the exact platform and engine.

Then it’s on to the interior fit. The seat belts – being an important installation – have already been fitted. Lines of seats wait overhead, while robots pluck dashboards from a conveyor belt for fitment in the waiting car. It’s here where everything is stunningly timed – a Pro-Cee’d arrives along the belt and its specific dashboard waits on another conveyor belt, and its seats wait on another. No dashboard will go into the wrong car.

09

Key components are attached by hand once the car has been painted. These include suspension parts and fuel tanks

12

The 7,000th car leaves the production line and is driven off to the test track. It’s the first time the engine has ever started Tale of two sportages

Then and now

LOOK at a Sportage a generation before the current one and you’d think it was made by another manufacturer. Here’s what Auto Express said about the old and new models.

Auto Express, February 2005 While offerings such as the new Cerato hatch might leave a lot to be desired, the Sportage is a lot more effective. There are weak areas though – the flared wheel arches seem to be an afterthought – but overall it’s not a bad looker… The engine is the most disappointing aspect; it’s surprisingly unrefined. There’s too much gruff filtering into the cabin… And at the test track the Sportage took 20.7 seconds to accelerate from 50-70mph in top gear.

Auto Express, July 2010 One thing that immediately strikes you is how radical it looks. Kia is keen to emphasise that it’s a crossover first and foremost, so gone are the boxy utilitarian lines of its compact SUV predecessor, replaced by a swooping, uncluttered shape. Climb aboard, and it’s clear that the focus is on quality.

There’s plenty of power from the 2.0-litre diesel, while the six-speed gearbox has a positive shift. Steering is responsive and the Sportage doesn’t suffer from body roll.

CarDealerMag.co.uk| 49

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FEATURE. At the end of the assembly line, workers wait to inspect the work of their colleagues. ‘If there is a problem, it’s better to see it now and fix it immediately rather than later on in the process,’ remarks Dvorak.

And then off rolls the 7,000th Sportage. A factory worker jumps into it and starts it up.

For her this Sportage is like no-other, and she trundles off to the exit where the Sportage is driven around the factory’s test track.

When the Sportage returns from the track, it’s driven through a tunnel where water is showered onto it to check for leaks (it’s just emerging from that stage in the picture on our cover). A final quality control and inspection follows and it’s then out into the parking lot.

When the time is ready, the Sportage will be driven on to a train transporter to begin its journey to the UK.

13

SALES

It’s a journey which finishes in dealerships like Alex Purdie’s. He’s dealer principal of Kia Bolton and every new transporter-load of Sportages puts a smile on his face.

‘I can’t help but like it – it makes up 20 per cent of my volume and is our biggest seller,’ says Purdie.

‘Seriously, though, I honestly like this car because of the way it looks. Though a fine car, the previous Sportage was just too utilitarian for the majority of buyers. It was more 4x4-like than the new one and traded more on its value-for-money positioning.

‘The latest Sportage really does appeal to all types of customer now. I can tell you many a story of a BMW X5 driver coming in and saying they have got to have a Sportage. We have had many buyers trading in their premium cars for the Sportage.

‘There is a waiting list, but we’ve realised that most customers are happy to wait for their car.

‘The problem came when we were selling the First Edition Sportage. We were putting customers’ names onto a never-ending waiting list. This was something which customers were surprised by because they were having to wait for a Kia, and our salespeople had never dealt with customers who had to be told they had to wait for their car.’

A year or so on from the First Edition Sportages, it seems customers are now content waiting – and also with the new car’s price hike over its predecessor.

14

Staff check the finished cars and any problems are immediately seen to. This all helps preserve the seven-year warranty

Our Sportage sits patiently waiting to be tested around the factory’s track. A water test will follow to check for leaks ‘We make no apologies for the fact today’s Sportage is several thousand pounds dearer than the old one,’ says Cole, frankly. ‘That’s because we know that customers are accepting the brand

‘We have had many buyers trading in their premium cars for the Sportage.’ more, and the Sportage is the car that represents this more than any other.’

Cole is frank about where he sees the Korean firm in the UK marketplace too.

‘The change in brand perception is going very well and we are continuing to move forward,’ he explains. ‘More people are considering us, and more people have a higher opinion of us.

‘But my own view is that if you went back to the Kia six years ago – with the exception of Sorento – the perception would have been cheap.

It’s the same with clothes and electrical goods.

15

Thousands of finished Kias line-up outside the factory and wait for the transporter train – don’t ask where our Sportage is

‘The problem with that is the customer feels it’s nasty. Now customers’ views are changing not just due to great product, but because product is at the cornerstone of brand development.

‘I had a Sportage for three months and I can genuinely say that in those few months, more people asked me about that car more than any other in my entire 25 years in the motor industry.

The number of people who asked me in petrol stations “how does that drive?” – and I even had a few “what’s that?”, it was unbelievable.

‘The Sportage has really caught UK buyers’ imaginations, and if you put together that combination of cars looking good, excellent build quality, reliability, and the fact they come with a seven-year warranty, then it has made consumers question why wouldn’t they buy it. There’s still people out there, for sure, who still say “but it’s a Kia”. The difference is that we’re confident in what we’re doing is now big brand behaviour.’

And as we wave the 7,000th Sportage off on the train it dawns on us, Kia really has come a long way in a very short space of time. [CD]

16

Trains coupled to transporter wagons wait to be filled up with Sportages for delivery to different countries.

CarDealerMag.co.uk| 51

FEATURE.

iCar uWant A clever new initiative from HPI is putting selling dealers in touch with buying dealers, solving endless stocking headaches. James Batchelor discovers what’s new

I

t’s one thing enticing customers into your dealership, but actually having stock sitting on your showroom floor is quite another.

Traditionally, one of the best ways dealers could get stock to fill their books was hitting the auction houses. But a large number of companies have shown that dealers needn’t spend their time in auction rooms if they don’t want to – online systems which source stock at the flick of a tracking pad finger are the new thing.

One of those companies showing dealers that there’s another way of getting hold of quality stock is HPI. The trusted name has launched iCar

HPI iCar is a fantastic new way to stock your forecourt with a variety of vehicles – including premium cars

52 | CarDealerMag.co.uk

Trade and it is already hitting the right notes with dealers.

Peter Jones, owner of Thomsons Garage of Sandhurst, was one of the first in the country to use the service and has found it to be a winning tool.

‘I’ve used a number of companies who source stock for dealers,’ Jones told us, ‘but few are as professional as HPI’s iCar Trade. The system is one of the simplest to use, and I have been able to sell a car I wouldn’t normally have in stock to a customer. I have around 30 cars on my stock list, but with iCar Trade I have a stock list of 500 cars available to me.’

This facility of finding a car with iCar Trade while the customer is in the showroom is one of the system’s unique selling points, says HPI’s operations director, Andy Entwistle.

‘There’s a plethora of online platforms at the moment and more are coming into the marketplace on a regular basis,’ says Entwistle.

‘However, one of our unique selling points is that iCar Trade has a customer-facing facility. This means the dealer and the customer can do a joint search to find the perfect car.’

The other unique selling point is that dealers can browse and source stock from a variety of different vendors to enable them to find exactly

what they are looking for. ‘We work with a number of vendors which include vehicle replacement companies, daily rental and contract hire vehicles – and that is how we get the range of stock,’ says Entwistle.

‘We receive daily updates from our vendors and then we update the system every day. We have seen more than 500 vehicles on the system, and about 30 new vehicles are added daily.

‘So, it is not just a big pool of vehicles but it is well refreshed enabling dealers to come back and browse tomorrow if they are looking for something specific.’

That pool of vehicles is of good quality too.

The stock varies in age from six months to five years, and the stock can be bought ‘sold as described’ or can be purchased and refurbished to BVRLA Fair Wear and Tear standard.

What were the reasons behind the system, though? ‘We felt that there was a hole in the market for getting good stock out to dealers.

Decent stock wasn’t necessarily getting back to the manufacturers to begin with or back to the dealers as a whole, and also dealers spend an awful lot of time standing around in cold auction houses for that one particular car.

‘It is not uncommon for dealers to spend six or more hours waiting around in an auction room for a particular BMW 1 Series, for example. We felt that offering something online meant that dealers could find that particular 1 Series in the warmth of their office and spend their time far more efficiently.’

An online system was

Stock list A selection of iCar stock TO find out how good iCar is, Car Dealer was set up with an account. We marvelled at the ease of use and were impressed at the variety of stock available. Here are just a few of them.

Vauxhall Corsa A 10-reg Vauxhall Corsa 1.2-litre SXi threedoor in silver with 6,935 miles on the clock can be bought straight away from iCar for £6,700.

Mercedes-Benz SLK Mercedes’ sporty SLK 200 Kompressor on a 56-plate with 67,175 miles on the clock in silver can be purchased by a dealer for £10,950.

BMW 1 Series A 60-reg BMW 1 Series 118d five-door in black with just over 13,000 miles can be bought right away for iCar Trade dealers for £15,750.

always the direction HPI was going to take, reveals Entwistle. ‘All of our services are delivered online because we feel that is the right way to do business – it’s fast, easy and painless. We have also been very successful in delivering provenance checks, a finance product, insurance products and more online, and this is where we thought the benefits of iCar actually were. The online aspect is really what made it work well for us. The idea behind this was that a dealer can sit in their office, and HPI can really help the dealer from start to finish. We can help dealers find a vehicle, help them check the provenance, help

‘‘

‘‘

We can help dealers find a vehicle, help them check the provenance, help insure it and help finance it. We are in a unique position.

insure it and help finance it. We are in a unique position in that we can help dealers in the whole car selling process, and it’s all online.’

However, perhaps the greatest benefit to dealers using iCar Trade is that the system increases speed. Dealers can offer a more flexible stocking approach to their customers, as they do not have to stock such a wide variety of vehicles.

This undoubtedly helps customer satisfaction because the dealer not only turns a sale around far more quickly, but they can give the customer specifically what they want. ‘These days it is very hard for dealers to have the exact specification of a car for their customers, but we are able to give them a bit more of an opportunity to find that vehicle,’ adds Entwistle.

Such a system that saves time and improves customer satisfaction must cost the earth?

Not so. Apart from delivery costs, there’s a flat buyer’s fee of £100 and an admin fee of £25 plus VAT – and that’s it. All cars bought can arrive feasibly within 48 hours meaning the customer does not have to wait weeks for their dream car.

Already, around 500 dealers are using the system, with a mixture of independents such as Peter Jones, to franchised dealers and large dealer groups such as Stratstone and Rybrook.

But iCar Trade is especially good for dealers who specialise in one make of car as the easyto-use system can be used to see how much of particular marque is in stock, and then the results can be refined by price, mileage and more to suit the dealer’s or customer’s budget.

‘It’s a new HPI product, but sits very nicely in what HPI already does well,’ says Entwistle. You can’t really ask much more than that. [CD] For more information visit hpiicartrade.com or call 0845 300 8901

CarDealerMag.co.uk | 53

FEATURE.

911 for 2011

Anyone know of a good Porsche 911?

Bought, sold and in profit – James Baggott reports on this month’s exploits

‘‘

Bought for... £0 Sold for... £250

Bought for... £0 Sold for... £790.03

w

hat a difference a few weeks make. Last issue, my colleague Duncan was lamenting the hardships we were facing finding a suitable car to splash out on to keep our pot of cash moving skywards.

A search of our friendly local dealership’s part-ex corner had thrown up few scraps, so feeling a bit down on our luck we did what any good man would do. Sulked.

Then went back for another go.

Fortunately our second visit coincided with the part-exchange disposal manager taking a week off.

At Richmond Hyundai, Portsmouth, that means the chop-in shop starts to pile high pretty quickly.

A phone call from sales manager Rob Kemp suggested we ‘come over quick before he gets back’. So I did.

The car park of the dual Citroen/ Hyundai site was teeming with metal perfect for our challenge. I spent a good hour checking out my options. There was a Hyundai Accent in a rather putrid shade of green, a very tidy Renault Safrane with leather and low miles, and a brace of Ford Kas. It was the latter that got my attention. I know they’re as common as trees, but experience has taught us it’s the cheap, low mileage, smallengined motors that sell well, so I tried to strike a deal.

Kemp was on the other end of the phone with a price list for what each motor stood him and we tried to thrash out a deal. The Accent was £400, Safrane 600 notes and the tidier of

Story so far...

Bought for... £985.25 Sold for... £2,150

We bought this Ford Ka and sold it to just-passed Sara Jayne Head the two Fords £1,000.

I couldn’t decide which to buy, so put a call in to columnist and real live car dealer James Litton. As usual his turn of phrase caught me out.

‘There’s a Hyundai Accent – looks tidy, high miles,’ I said.

‘How much does it weigh?’ asked Litton.

‘Erm, not sure, looks quite lightweight, why does that matter?’ was my innocent reply.

‘Because that’s about all it’s worth – its weight down the scrapyard,’ laughed Litton.

I may have been doing this for a year, but there’s still some car dealer lingo I need to learn… After he’d stopped laughing Litton advised the gold Ka would be our best bet.

There’s bleeding loads of them, he explained, but price it right and we’d shift it in no time.

He suggested sticking it up for about £2,200 and seeing how

I may have been doing this for a year, but there’s still some lingo I need to learn.

Bought for... £2,000 Sold for... £5,005

we got on. In another stroke of luck it transpired it had tax to the end of the month and a year’s MOT. With All bought for... £500 just over £900 already in the dealer’s All sold for... £2,720 bank – left over from the part exchange deal we did on the Citroen – I suggested to Kemp he let us have it for that. And he did.

It didn’t take long to sell either.

That weekend a meal round friends revealed their neighbour’s daughter Bought for... £6,000 had just passed her test and was Sold for... £8,250 looking for her first car. A week later and it was sat on their drive with young Sara Jayne Head about to head off for a test drive.

A bit of research suggested similar models were selling for around £2,200, Bought for... £8,110 but to seal a quick deal I agreed to let Sold for... £8,000 it go for £1,700. That meant a healthy chunk of cash for our charity pot and although less than what we could have achieved online it was a quick deal and flipped more money than we’d made on the Volvo, Fabia and Bought for... £200 Scenic combined!

Sold for... £375 With this sale included the pot is now up to £10,145 – easily enough for a 911. We think. At the time of going to press we had a few irons in the fire. Find out next month if we manage to finally Bought for... £4,000 Bought for... £2,800 achieve our goal. [CD] Sold for... £4,400 Sold for... £3,000 CarDealerMag.co.uk | 55

EWARDS 2011.

CarDealer.

Ewards

2011

I n a s s o c i at i o n w i t h

autotorq.com Has your website got what it takes to stand out online? We’re starting our hunt for the best automotive websites of 2011, but you have to be in it to win it. Here’s how you can take part.

T

he internet is one of those rare things that no matter what size of dealership or operation you run, it affects you in the very same way.

You could have a forecourt with six cars or 600 and the internet will still play a vital role in the selling of those vehicles.

Why? Because it’s a ‘virtual showroom’, a ‘window into your business’, and a ‘shop front for cars’. Call it what you will but the internet is a key area of business which dealers are logging onto every day because that is the wish of their customers.

Just put yourself into your customers’ shoes and

you’ll see why. That dishwasher you have been promising for the wife? It’s unlikely that you’ll be visiting every single dishwasher shop this side of London to find the best deal. You’ll naturally have done your research – visiting hundreds of sites, probably while her indoors is watching Casualty – and you’ll know where to go to get that Bosch unit either for the best price, the best customer experience, or both.

The same is true for cars. Customers know where to go to get their Citroen C4 because they’ve done their research at home. They’ve read the reviews, watched people on YouTube doing

MEET THE EWARD JUDGES Autotorq.com

Autotorq

hy hy

This year I will be looking for dealers who are ready to satisfy customers’ needs when they go online. Very few businesses are able to do this – and that is especially true in our industry – so a good web presence will be one which supplies consumers with information to allow them to make better decisions.

Stewart Niblock 56 | CarDealerMag.co.uk

Gforces.co.uk

GForces

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I will be looking for evidence of a website that makes the consumer journey as effortless, rich and relevant as possible. Well-displayed stock and good offers and relevant content are a starting point but I want to experience a cohesive approach between the web and showroom.

Tim Smith

Codeweavers.net

Codeweavers

hy hy

I am looking for sites given the love and attention that demonstrate that they sit at the centre of the dealer’s marketing strategy. I would like to see evidence of on-going reviews, checks and improvements to the site and that all features work correctly and are presented to their best effect.

Roland Schaack

CarCarePlan.com

Car Care Plan

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I’m really looking forward to reviewing this year’s Car Dealer Ewards entrants. If the variety and quality of the submissions is anything like last year then we’re going to be awarding some excellent websites. Personally I’ll be looking for attractive and engaging websites that are innovative whilst retaining a high degree of usability.

Matthew Strudwick

..in association with Autotorq.com

HOW TO ENTER EWARDS 2011 To ENTER you need to register your website with the following details by emailing ewards@cardealermag.co.uk.

The more detail you include the better, as this will help our judges analyse what you considered when putting your site together.

We’ll look through all entries and shortlist 10 in each category and these will then be handed to the judges. Each judge uses their own set of criteria to mark the websites and they allocate 10 points to their favourite, nine to the second favourite,

descending to one point for their least favourite.

We then take all the judges’ points and add them up to come up with our winners. The closing date for entries is November 24, but the sooner you get your entry in the better.

Every month in the run-up to the results we will highlight one of the entries and our judges will critique what they like about it – so if you get your entry in soon your dealership could be featured in an upcoming issue. Best of luck!

handbrake turns in it, and they’ve chosen what spec and colour they want via the manufacturer’s car configurator.

Having a website that informs the customer about the Citroen C4 is vital, so too are plenty of pictures to let the customer make their mind up. It has to be easy to use and look rather good too.

But what happens when that customer wants to buy? Does your site have the capability to buy or not? Does it show the best deals to tempt the customer into your showroom?

And that’s precisely what the Car Dealer Ewards are all about. It’s the awards where we showcase, analyse, dissect and celebrate the best websites out there selling cars.

Now in their fourth year, the Ewards – held in association with Autotorq.com – have become known as the leading gongs

celebrating this sector. For 2011, we’ll be looking for winners in eight different categories and they are:

Webzation.COM

Webzation

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As a business that continues to innovate, we want to see a like-minded approach with the entrants. Use of more engaging content and functionality will be paramount to fulfill the requirements of a rapidlyevolving consumer market. The victor will need to demonstrate enhancements beyond last year’s winners.

James Tew

1. Single Franchised Dealer – this is open to all franchised dealers that represent just one manufacturer.

2. Multi Franchised Dealer – this is open to all franchised dealer groups that hold franchises for more than one manufacturer.

3. Car Supermarket.

4. Independent Dealer.

5. Car Manufacturer (automatic entry).

We’ve also added three new Ewards this year, and they are: 6. Social Media User of the Year.

7. Web Personality of the Year – nominated and voted for by the judges.

8. Innovation of the Year.

blueskyinteractive.co.uk

Bluesky

hy hy

I am going to be looking for websites and digital innovations that don’t just look flash but also deliver real results and functionality. We see it as crucial that technology used within a website works both for the customer and the website owner to help generate long-standing relationships.

Alan Crane

Niblock

Ewards insight

Expectations growing

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nother year goes by and the gap continues to widen between the car buyer’s expectation and our industry’s inability to keep up with them. It’s in every sector but it so happens that the car buyer is one of the most digitally savvy shoppers out there. They spend more time researching their next car purchase on the internet than researching an elective medical procedure.

That’s the latest research from Google Automotive and Shopper Sciences who have conducted scientific research into the influences behind decision-making when it comes to buying a car. We need to be ready and waiting when they go online or grab their phone and start looking for information to make their decisions.

So for this year’s Ewards, the website remains the priority: They need to be cleanly designed and customer-centric.

Homepage cramming is out – you don’t need to stuff all your offers into a tiny space above the fold. The cars are the stars and this is what they want to see: attractive model range imagery. They’re also not particularly interested in photographs of your dealership.

After the website, we will be looking across different channels. There’s a huge amount of value in Google Places and it’s free. Positive reviews are dynamite and between sales and service there are hundreds of customers that are completely satisfied, so just ask them to write something!

Then intelligent use of mobile, paid search and video. They all help to persuade the customer to contact your business.

Who is Stewart Niblock?

He is chief executive officer of Autotorq.com, one of the leading digital agencies in the UK. Find out how he can help you at autotorq.com

ProgressDMS.co.uk

Progress Automotive

hy hy

I will be looking for websites that strike the right balance between clean, functional design, ease of navigation and the use of the latest, innovative technology. I’ll also be looking for sites that demonstrate an understanding of today’s car buyer, and the means they have for accessing websites.

Alex Knight

Autosonshow.tv

Autos On Showhy hy I’ll be looking for websites that put the forecourt at potential buyer’s fingertips. To do this a site needs to embrace innovative technology, it needs easy navigation, interactivity, strong visuals, ideally video, a relaxed design and easy-tosee specifications. It should also communicate the brand personality of the dealership.

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guide to the WEB Autotorq

Dealers can’t ignore digital W: autotorq.com T: 020 7384 8501 would decide how much they wanted to spend, then visit the car dealer. Today, all of that is done online – just as it is when choosing a holiday, just as it is when buying a new TV. It’s reality.’

So where does the traditional car dealer sit in this brave new digital world? Well, surprisingly, in a potentially safer position than ever before, reckons Gordon. So vast are the resources available to car buyers, many are facing information overload. What’s needed is an expert sales consultant to guide them through the maze of data – and this is where car dealers come in.

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People have all the information but need help with the navigation.

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T

he web is no longer optional for car dealers, states Autotorq MD Paul Gordon. ‘It’s the modern way of doing business, and you can’t fight it. Dealers should no longer be asking themselves if they should have a web presence: it’s now mandatory.’

Today’s big growth area is mobile, says Gordon.

For smart dealers, this offers tremendous opportunities. ‘We are seeing mobile used in new and exciting ways. It’s being used almost at point of purchase: buyers are using their mobile devices to search for dealers (and deals) in the morning whilst at the supermarket, then visiting the ones that capture their attention in the afternoon.’

Such dynamic, real-time searching is a potential gamechanger for the car retail industry, says Gordon. ‘Mobile can become the most fantastic way of finding dealers, if retailers engage with it.’ Dealers should thus be ensuring their existing website is fully optimised for mobile as it’s where the real advantages are found.

All new websites designed by Autotorq are also optimised for mobile use. If all those rivals are enjoying an uplift because of this, could it be time you checked your own site too, just to be sure?

Don’t assume it is, because it probably isn’t…

Gordon does acknowledge that, in some ways, such digital tools and dealer websites negate the traditional car salesman. ‘Years ago, people

‘Buyers need an informed professional to take them though the clutter.

‘It’s similar to financial product advisors, or retailers of high-end sound systems: People have all the information but still need help with the navigation. The dealers who are excelling today already understand this.’

Gordon likens it to the dawn of the industrial age. ‘Digital is fundamentally changing how people consider, search for and buy cars. I’m

told some dealers are hoping they can get to retirement without worrying about digital. I’d say that’s unlikely – nobody can ignore it, such is the rapid rate it’s growing at.’ Digital training should thus be available to everyone within the business, not just the younger whizz kids.

It’s easy to be daunted, when you consider how vast the digital world is. ‘Web apps, mobile, video, they’re all resources: People don’t all engage in the same place. Therefore, make sure someone in your business understands the most important ones for you.’ Otherwise, everyone will be chasing in the dark.

Digital does lend itself to easy application of CRM tools, advises Gordon. ‘It’s always been too difficult to do this wholly effectively in the past, because it’s so labour-intensive. Automated tools are a wonderful opportunity to strike up longterm relationships with customers.’

Throughout the ownership lifecycle of a car, there are dozens of opportunities to drive aftersales, but it’s only now that dealers have been given the tools to do this with ease. Don’t waste the chance, says Gordon.

Overall, digital can help dealers become a brand in their own right, he concludes.

Be intelligent in managing this new digital relationship, and the only question customers will be asking will be, ‘why wouldn’t I go back?’

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autotorq.com

gforces

Maximising the benefits W: gforces.co.uk T: 0844 247 4523

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We at GForces consider Live Chat to be one of the most effective forms of communication.

These comparisons only stand if the car dealer has considered SEO at all. Some still haven’t.

Those dealers who are still relying on traditional advertising, such as classifieds, are paying vastly more per lead than a well-honed digital strategy: Smith puts the cost per lead at upwards of £100.

‘Print is still highly invested in by the industry, often at the expense of search. The kilter is massively out of balance. Car dealers need to invest much more online and much less in traditional media.’

Dealers can help convince the doubters by engaging everyone within the business in utilising the web properly.

‘Dealers should offer training in how to manage leads through the dealership. The best dealers are already making sure their employees are fully engaged with the web.’

This is the only way to ensure everyone keeps up with the fast pace of technology. Indeed, new forms of web technology are growing fast, and changing the landscape once again, says Smith.

‘Mobile is incredible: 12-15 per cent of traffic goes

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Forces commercial director Tim Smith is clear: Do not assume that a good web presence starts and ends with technology alone. You can have the best web platform in the world, he says, but if you do not manage it well, you will miss many of the benefits the web can bring.

‘Nowadays, the battle for consumers is won online,’ he says. ‘Car buyers are using it to go 80 to 90 per cent of the way towards their next car purchase. It is taking a huge amount of the traditional salesman role out of the hands of car dealers.’ That fact again: 80-90 per cent of the decision-making process is being done before people even set foot in a dealership...

It’s all evidence of a major cultural shift, says Smith. Today, consumers are looking to dealers for more of a retail experience, rather than a pure sales pitch. This is shown by the number of dealers people visit before purchase – 10 years ago, it was five or six. Today, it’s one or two. Buyers are simply using dealers to complete the deal, rather than actively be sold to – meaning the way to win custom and gain differentiation over rivals is increasingly becoming the online experience.

‘The battle is won online,’ confirms Smith.

Is your dealership, he asks, meeting these modern customer expectations? Comparisons shouldn’t be with other car dealers either, but with other retailers who set the online standard: firms such as Apple and Amazon. Their secrets are numerous, but one of them is meeting web customers’ needs with, in recognition of their importance, full support. ‘People don’t expect to wait for a response online. Immediacy is the new norm.’ You wouldn’t leave a telephone unanswered. Why ignore a web query?

Smith references the EasyJet online advisor, which allows live chat with an advisor.

‘Eighty-five per cent of top car dealers use social media – Facebook and Twitter – but less than 25 per cent have engaged with live chat – yet we at GForces consider it one of the most effective forms of communication. Many people are getting caught up in the hype of social media without considering how to offer useful services to customers. Live chat does.’

This is also seeing some dealers forgetting the basic, fundamental importance of search engine optimisation, he adds. ‘SEO is the single most effective form of marketing. The cost per lead here is £2-£5; paid search jumps up to £15-£35.

Portals, meanwhile, can range from £25-£75.’

to dealer sites via smartphones and tablets such as the iPad.’ This is accelerating changes in how dealer websites are used.

‘Fifty-one per cent of dealer web activity is now done outside dealer hours. The peak is 7pm-9pm.

Some dealers are not aware of this, and thus are not managing it. They have no mechanisms in place to deal with it.’ Do you?

Smith adds that it is not digital providers such as GForces that are driving this agenda. ‘We are simply looking at how consumers are buying and what they expect.

Our research is extensive and all the trends we see underline this huge cultural shift.’ Dealers don’t necessarily need to get all this expertise in-house, but should engage with their digital provider and act upon the advice they offer.

‘It is the biggest revolution for car dealers ever.

When 80-90 per cent of the decision-making process is done before you even see a customer, having a front-running digital dealership has never been more important.’

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guide to the WEB Motors

Cost-effectiveness is key W: Motors.co.uk T: 0845 265 6000

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60 | CarDealerMag.co.uk

sites that consumers visit when they are in the midst of their research. They’ve read the reviews and there we are – right in front of them.’

Motors.co.uk is not just about a website, though. The firm also has AutoEdit and AutoExposure in its armoury. ‘AutoEdit is a vehicle upload tool,’ says Jones. ‘It’s very easy to

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Users can spend a lot of time on the site and engage in interaction on the pages of the site.

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racking down a company that can help dealers with virtually all of their online advertising needs is difficult.

Often, getting a company to design a dealer’s website and upload a dealer’s stock to an advertising portal are two different processes.

Happily, however, there is one firm that can help. ‘We provide dealers with a significant volume of audience and a very high level of exposure across our network,’ says Motors.co.uk’s commercial director Phill Jones.

‘We get around 1.5m unique visitors a month – that is a huge shopfront for dealers and their stock. We also pride ourselves on being very costeffective per lead. What we are trying to do for dealers is to make their phone ring off the hook for as little money as possible.’

Motors.co.uk captures a high level of traffic because of the amount of stock on their site.

More than 150,000 cars are available and the site has a very credible search facility too.

‘Users can spend a lot of time on the site and engage in interaction on the pages of the site,’ explains Jones. ‘We also spend a lot of time on providing trust and certainty for buyers as we history-check as many of the cars listed on the site as possible – which, on average, is nine out of 10 cars – and give as much confidence to the buyer as possible, so when they pick up the phone to the dealer, it’s about as hot a lead as you can get.’

The firm has bespoke packages for large dealers who have particular needs, and for independents, Motors.co.uk is able to provide a significant audience for them – and it is all cost-effective.

‘We have been going for four years now and the site gets an enormous amount of brand exposure in the Daily Mail, the Metro and nearly 200 regional newspapers. Those local newspapers touch 20 per cent of the UK’s population, and we also have our TV and radio marketing campaigns.

It’s our job to aggregate dealers’ marketing spends and reinvest it to get marketing efficiencies for the dealer.’

The Motors.co.uk website also has another attribute – its functionality. ‘We believe that a confident consumer makes them a more likely buyer, and that’s why we provide tools on the site such as advanced search.

‘This all means that when they are calling the dealer, they have got a pretty good idea of what they want to buy and at what price. We also appear on Parkers.co.uk and Honestjohn.co.uk which are

use, allows dealers to upload their stock from their forecourt to the internet, and is also free to export to any other site when dealers are advertising on Motors.co.uk. This makes the cost of advertising online far more transparent.’

AutoExposure provides around 800 websites to largely independent dealers, and creates a website for a dealer to include all of the elements consumers want and expect from a website.

‘With Motors.co.uk we are able to provide dealers with a full web offering. So for dealers who are just setting up in business, with AutoExposure, Motors.co.uk can give dealers a website, and we can get dealers onto Motors.co.uk to advertise their stock as well.’

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autotorq.com

Bluesky Interactive

Harness power of mobile C

ustomers are no longer content just viewing dealers’ websites in their own homes or during their lunch break in the office – they want to view them all

the time.

‘Consumers want to connect on mobile devices today, and here is the proof,’ says Tony Hilton, Bluesky Interactive’s marketing director. ‘Google has recently commented that consumers are increasingly using mobile devices to shop for a new car and research undertaken by ChannelNet indicated that more than 23 per cent of all auto shoppers use a mobile during the car-buying process.

‘Research has also indicated that recently, 45 per cent of Auto Trader’s users accessed Auto

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Trader Mobile on a dealer forecourt, seconded

by ChannelNet’s research indicating that 40 per cent of mobile searches occur when the user is on the dealer’s lot. Therefore, your mobile service performance, or lack of it, will impact on your business results,’ says Hilton.

Bluesky Interative can help in this respect. It’s a digital marketing company which has a high level of experience in the motor industry, and mobile services is just one facet of their business.

Their team of experts can work with dealers to simply make their websites become more mobile-friendly, highlight areas such as used car stock and contact information to really drive inquiries, or completely overhaul a website to convert it to mobile marketing.

Forty-five per cent of Auto Trader’s users accessed Auto Trader Mobile on a dealer forecourt.

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W: blueskyinteractive.co.uk T: 0841 255 855

Bluesky can also help dealers tap into one of the most hotly-talked-about areas of mobile technology – apps. Their team of people can help dealers create a simple app which can show off a dealer’s services and offers in the best, most attractive light.

‘It is our understanding and experience of this media channel that allows us to build a longterm, two-way dialogue with a customer.

Mobile is the most powerful and effective tool at a brand’s disposal,’ adds Hilton.

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guide to the WEB Progress Automotive

Superb software systems C

hoosing a firm which really understands the motor industry and has products designed purely for dealers is probably one of the best things dealers can do when it comes to onlinebased solutions.

‘I used to work in the industry for a large prestige dealer, and they just didn’t realise the web was happening. Now, I think most people realise that it is where everything is happening,’ says Alex Knight, Progress Automotive’s internet operations manager.

It’s more important than ever for dealers to be investing in the internet, believes Knight. ‘The car industry is several years behind in the adoption of online systems – whether that’s websites, SEO

‘‘

or the capacity to support web browsing.’

This is how Progress Automotive can help.

They are software developers – and all their products are ones they’ve created by themselves and for the motor industry.

‘We can provide car dealers with a website, used car stock locators, and various other processes to help dealers out with solutions including digital marketing and our workshop management piece of software called Workshop Pro which is, in essence, an electronic version of the T-card system. But dealers are often very busy so we can manage a lot of the work for them.’

So Progress Automotive has a wide product portfolio to offer dealers? ‘Absolutely,’ says Knight.

‘All our products are designed to augment what

The car industry is several years behind in the adoption of online systems.

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W: progressdms.co.uk T: 0844 558 0340

dealers would get from a DMS system. The problems with DMSs is that they’re a one-size-fitsall solution. It has to do so many functions, that we don’t think the level of focus on individual areas of the business is there.

‘We can pull data out of any DMS system, so whether it’s a website or a piece of software to manage a dealership, we can help dealers use it in a better fashion and design better systems for dealers.’

WebBuilder

PROGRESS automotive solutions

Internet Marketing

Make the move to mobile

Progress offers mobile websites with advanced used car functionality. They are cheaper and quicker to produce, and unlike apps they are cross-browser compatible across Apple, Blackberry and Android devices.

Phone:

0844 558 0363 62 | CarDealerMag.co.uk

With 84% of regular mobile internet users using mobile search to research information on local retailers, you can’t afford to ignore your new, more mobile customers!

Email:

Visit:

sales@progressautomotive.com

www.progressautomotive.com

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Autos on Show

Stand out with video T

he ability to watch videos whenever you want to sounds like a great innovation.

But for car dealers, that innovation has become a major headache.

‘The introduction of faster bandwidth into people’s homes has led to substantial technological advances in terms of video,’ says Autos on Show’s managing director Adam Price.

‘People want to see more of the products they are interested in and online video marketing caters to this demand,’ explains Price. ‘The video revolution is consumer-led and therefore by responding to the demand for video, dealers will inevitably sell more cars.

‘We provide dealers with the technology to make this possible and the key result our clients

‘‘

have experienced is increased sales,’ explains Price. ‘Ultimately, video is set to be an integral part of online marketing. By adding video now, dealers can futureproof their online strategy.’

Autos on Show can help dealers by providing them with video to help bring their stock to life. Their software offers live streaming and on-demand vehicle videos, with automated still photographs, and can be used with or without a turntable.

The solution comes packed full of features to enhance dealers’ overall online marketing efforts, such as social media sharing, and branded YouTube teasers. ‘Our clever solution ensures that within one minute of the dealer plugging their camera into their PC the on-demand video and

By responding to the demand for video, dealers will inevitably sell more cars.

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W: autosonshow.tv T: 0800 644 6894

photographs will appear on the vehicle details page along with all the integrated features,’ says Price.

But the biggest bonus of using Autos on Show is that it can speed up the process of getting cars online. ‘It is even easier than uploading a photograph to your website, so dealers can enhance their visual offering with video and save time!’ says Price. ‘The internet is a hugely competitive market place for dealers and video will make them stand out.’

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guide to the WEB Codeweavers

Show why you’re different W: codeweavers.net T: 0800 021 0888 page impressions and bounce rate. However, says Hill, one of the most important stats is average visit time.

‘Dealers should consider this a key metric, as it’s a measure of how well you command a customer’s attention. There are many ways of improving this, such as including interactive tools like finance calculators and payment search tools.

Not only does this retain people on your site for longer, but it also allows them to search for cars in an entirely different way. It’s both compelling and a far better way of showing they can afford the cars you have in stock.’

This is an example of letting customers dictate the parameters, says Hill – and doing so means they’re much more likely to pay attention to the results. ‘Most payment search solutions work on assumptions dictated by someone else: That people want 60-month terms, for instance, or have a £1,000 deposit. This can result in a list of cars that’s irrelevant to the customer and, therefore, unengaging.

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Dealers could film customers giving testimonials and put them online.

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artin Hill, commercial director of Codeweavers, has two observations of retailers with a poor web strategy: ‘They don’t give the customer a reason to buy from them, and they try to treat all their digital customers in the same way as one who walks into the showroom. Both are issues we see time and again, but both are easily fixed.’

For some dealers, giving web customers reasons to buy from them involves adding feature after feature onto the website.

They see this as providing memorability, but it’s something Hill fundamentally disagrees with.

‘Websites should not have lots of clutter and should not be overwhelming. The worst thing dealers can do is to use auto-play videos or loud music. Think about it: Is this what your business really stands for?’

Instead, he says, dealers should take a more considered approach. ‘Think about what your business USP is, and then think how to make your website say this.

‘If your big draw is customer friendliness, for instance, consider having evidence of this on your website.’ And make sure, he adds, it draws from all the tools at your disposal.

‘You could have a simple section with customer testimonials… but this doesn’t do anything different from umpteen other dealers.

‘I’d expect it to be there: this is brochureware, when it could be so much more. Dealers could, for example, film customers giving testimonials, and put these on their site.

That’s much more engaging and, crucially, far more convincing and genuine.’

Hill explains that this needn’t be involved or time-consuming. ‘If you get a letter or email of praise from a customer, contact them and ask if they’d like to come in and say this on camera. The incentive can be a free valet or other complimentary service. While their car is being attended to, speak to them for a few minutes and upload this voxpop to your site. Doing this is infinitely more powerful than a one-liner of text on the site.’

Treating web customers differently is another imperative. ‘The carrot here is engagement. If you understand why they engage and provide this on your site, you’ll keep their attention far longer than your rivals.’ Many dealers now understand analytics data, such as

‘Codeweavers tools will let users set the terms and then generate a list of cars they can afford.

It’s a new way of doing things that guarantees you’ll capture their attention.’

A strong web presence isn’t hard, says Hill. ‘You simply need to make sure you’re offering more than just brochureware. You can’t just repackage printed material, but need to open up and do much more besides.

‘It doesn’t have to be everything, but should be enough to help people make an educated decision – a rise in engagement and better-quality leads will follow from there.’

One of the biggest complaints consumers have of car retailers is that they’re not open. ‘The perception of the industry is that everything is kept close and nothing is shared.

‘Through their websites, good dealers can be open, honest, transparent and show everyone why they are different.

‘By contrasting with this industry reputation, dealers will automatically be more memorable – and, as a result, far more relevant.

‘We Brits are not very good at complaining, but we ARE good at telling people to get stuffed electronically, by clicking away from their site. Make sure your website gives them no reason to…’

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Buyacar

The site that sells for you W: buyacar.co.uk T: 0845 226 0101

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Finding a new face for a Fiat 500 – or any other car – is child’s play with Buyacar. The firm puts web buyers’ deposits in your hands leaving you to bank the proceeds.

converted sale and the deposit to the dealership.’

This allows dealers not to pay their sales staff commissions or have to pay out advertising costs, and also makes the whole business of selling online remarkably straightforward.

But that’s not all Buyacar can offer. The firm can also provide online finance through major lenders so customers wanting to buy a dealer’s vehicle can do so quickly and easily without having to worry about the finance bit, and Buyacar also provides an online part-exchange service.

Here, accurate valuations and condition reports

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one-stop shop portal for dealers to advertise and sell their cars online might sound like a dream scenario, but it also sounds a little way off. The internet is good for many things, but the ability to advertise and actually sell used cars with little fuss sounds just too good to be true.

But it isn’t. Buyacar can offer dealers just that – advertising and selling, and the firm is proud to be doing things just little bit differently.

‘Other used car selling mediums do not physically sell the cars for the dealer, they just provide the leads or an answer to an advert,’ says Oliver Collins, Buyacar’s operations director.

‘While this is good, what we do is physically sell the car on behalf of the dealer. We do this because we understand a lot of dealerships are set up to concentrate on making sales due to customers walking through the door. But when it comes to internet sales, a lot of dealerships and their sales staff are not really trained to deal with those types of inquiries.’

Buyacar is. With nine years experience and a skilled team of salespeople, they can really help dealers in the tricky and often complex world of internet selling.

‘We strongly believe there is nothing else like it available,’ says Collins.

‘We have been running this used-car service for the last six months with dealers and it is going very well indeed.’

And it is easy to see why. Buyacar allows dealers to advertise their approved stock of cars and LCVs online for free – with Buyacar taking just a commission only if a vehicle order is taken with a deposit – and because the firm only allows franchised dealer-approved stock, dealers can be assured that their prized motors will be compared with similar, high-quality machinery.

All adverts accept up to 20 photos, technical data and specification, and an electronic feed of a dealer’s stock can be taken from some of the leading DMS systems.

Then the vehicles will be advertised not only on the firm’s website, but Auto Express’s too – all due to a recent partnership, ensuring that dealers’ adverts get seen, read and processed all over the country.

That’s the advertising bit, but how does the selling bit work? ‘Easy,’ says Collins.

‘Our sales people will take the inquiry, convert it into a sale, take a deposit, and hand over that

are carried out – and again this all makes the experience for the customer and for the dealer as straightforward as believably possible.

To get started, Buyacar just needs a dealer’s stock feed from a DMS system, and then they can begin to get selling online.

However, do not be under the illusion that the service is new with no proven track record.

For the past six months, Buyacar’s used car service has been used by some of the top dealers in the country, and has since sold and delivered more than 10,000 cars nationwide.

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guide to the WEB Manheim Seller Advance

It’s such a simple process W: selleradvance.com T: 0844 856 4545

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Seller Advance has been live for dealers for the past 18 months and we are finding that dealers are expressing more and more interest in it because of the help it can give them.

a retail deal or not. Obviously, this is one of a number of factors – but valuation is key.’

Step one sees an instant valuation carried out.

The dealer appraises the part-exchange and then obtains an online valuation from Manheim. ‘One big thing that dealers are facing is motivating their sales people,’ says Wiseman.

‘This forces the sales person to go out there, examine the car and drive it.

‘That in turn gets the customer more interested because they can see that the salesperson is taking their pride and joy seriously.’

Seller Advance calculates the valuation from a number of sources of data including a VRM look-up system owned by the DVLA. This allows the dealer to be reassured that the accuracy of the valuation they receive is extremely high.

In fact, the valuation error rate is an amazing 1.5 per cent – and a figure which is reducing all the time.

There’s also another major benefit, as Wiseman explains: ‘Seller Advance also includes an accurate recognition feature.

Dealers are facing up to 60,000 different model

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T

here are many online tools on the market which can help dealers in a variety of ways – from advertising stock to photography and video.

But there is one clever tool available that caters for an area of the car-selling process that is often overlooked – the valuation of the customer’s part-exchange.

Manheim has designed a system called Seller Advance. It is an end-to-end online remarketing product, and is a simple five-step process from valuation to the car being sold at a Manheim auction.

‘Dealers are telling us that accurate valuations will help them for the rest of the year in terms of business,’ says Daren Wiseman, Manheim’s general manager of valuation services.

‘Dealers are spending a lot of money on advertising to get customers into their dealerships and most of these customers have a partexchange to dispose of.

‘The accurate value of that part-exchange can be a deciding factor in whether the dealer does

derivatives in the market place, and one of the biggest issues facing dealers in the valuation of cars is mis-identification.

‘While a Ford dealer might know his Ford models very well, that Ford dealer probably won’t know too much about a BMW and might misidentify the customer’s part-exchange. That in itself can create an inaccurate valuation – we are narrowing down the room for error in the valuation process.’

Once this has been carried out and the dealer decides the customer’s part-ex is not for retail, they can then set a projected delivery date for the customer.

Step two occurs as soon as the customer has dropped off their part-exchange. The dealer can then ‘push’ the car into auction all online, therefore saving time.

Step three happens once the car arrives at a Manheim auction – the firm inspects it and pays the dealer the agreed valuation.

Meanwhile step four allows the dealer to set a reserve price for the car. Once the vehicle is sold, step five kicks in. If the vehicle made money above the advance payment, Manheim will pay out the difference – and vice versa.

‘Seller Advance has been live for dealers for the past 18 months and we are finding that dealers are expressing more and more interest in it because of the help it can give them.’

And with more than 180 different dealers finding their valuations are more accurate and therefore improving their customer satisfaction levels, Manheim Seller Advance is proving it’s worth its weight in gold.

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VCARS

Quality leads and more...

W: vcars.co.uk T: 0845 302 5374

F

‘‘

If you are thinking about getting your cars found through a Google search term, then VCARS is your most cost-effective method to covering that space.

management team looks into improving their dealers’ level of inquiries and customer satisfaction.

There is another great advantage in using VCARS – the firm can help dealers achieve even further ROI from their online advertising budget.

‘With effective advertising of a dealer’s stock, we can capture buyers surfing the web looking for the same make and model of vehicle and put them together. We will record all activity and prove we have brought you not just leads but sales and exactly what car you sold,’ says Wenn.

At the moment, it’s a very hectic time at the

‘‘

or dealers, the move to selling their stock online has well and truly begun.

It has been happening for many years now and with current research showing that an ever-increasing number of car buyers are using the internet to find their vehicles, dealers would be unwise to discount the importance of their online presence.

‘The internet has so many benefits when it comes to advertising in comparison to traditional methods,’ says VCARS’ sales and marketing director Michael Wenn.

Radio and paper advertising can struggle to feed back accurate data on whether it was a success or not to a dealer.

For example, how many people looked at your advert? How many people phoned, emailed and came down to the showroom because of that advert? How many sales were a direct result of the traditional advert?

Understandably, even getting this information can be missed as a salesman wants to get on with the sale.

A major benefit is cost. Putting aside its effectiveness for one moment, it is far cheaper to advertise online than running adverts on radio or in print.

‘Print press and radio is also one time only,’ says Wenn. ‘By this I mean you get one shot and the paper is in the bin a day or two later, by which time you have sold vehicles and the advert is out of date. Online is timeless and evolving daily with updates happening immediately to your adverts.’

So, how can VCARS help dealers? First of all, it’s an online advertising business delivering quality leads for its dealers.

Wenn continues: ‘If you are thinking about getting your cars found through a Google search term, then VCARS is your most cost-effective method to covering that space within your online strategy.’

VCARS offer an excellent service with absolute transparency over all activity dealers’ advertising receives, including an ROI model that can prove beyond doubt a cost per sale rather than a cost per inquiry.

Their system is easy as they are set up with all feed providers. They have a highly skilled technical team taking care of dealers’ stock feed on a daily basis, while a dedicated account

VCARS headquarters. They’re not only already providing a great service which can improve the number of customers to a dealer’s stock while making a dealer’s advertising spend more transparent, but the firm also has some interesting new developments coming soon.

VCARS are going to be focusing on helping dealers obtain more ROI and better support online in times of hardship for the market, by offering additional products in their portfolio at no extra cost. The new production is called VCARS DNA and dealers are encouraged to keep an eye out for it. [CD] CarDealerMag.co.uk | 67

FEATURE.

Time to

shine

If you want to maximise returns selling paint protection then you need training. Fortunately there’s one firm that offers it free of charge, reports James Batchelor

w

e all know how important product knowledge is in the process of selling a car. With clued-up customers walking through your door every day, you need to know everything about that Kia Picanto to tempt the customer to put their hand in their pocket. That’s not to mention knowing how best to make the transaction run as smoothly as possible with some good customer service.

But with add-on products like paint protection, surely product knowledge and good selling techniques aren’t as important?

Michael Ball, Allen Ford Group’s sales director, would beg to differ. ‘Naturally, the vehicle is the most important part of the deal,’ says Ball. ‘Then there are other associated products such as GAP, dealer-fitted accessories and paint protection. But, in the same way as the sale of the vehicle, products like paint protection need training to sell too.’

Allen Ford Group has been working with Supagard for more than 20 years – and they have come to realise they wouldn’t use any other company.

‘At one point we did step away from Supagard for a short while a long time ago, and within a year we decided we had to go back,’ explains Ball. ‘We went back because not only are the products good, but the support and training are excellent and enable us to be successful with the product.’

Throughout those 20 years, Ball has been dealing with one man from Supagard: Terry Abbott. ‘We insist on having the most experienced people within Supagard to give us support,’ says Ball. ‘We recently took on Supagard in our Swindon and Bath dealerships, and all new starters in those showrooms went through an induction programme with Terry.

‘Part of this induction includes learning how to sell the product, and then there’s follow-up training which happens fortnightly. Here, Supagard will target the underperforming sales people and sales managers and give them refresher sessions 68 | CarDealerMag.co.uk

to help them get back on track. It’s very thorough and I know that the sales people and managers are very comfortable doing it.’

Allen Ford Group has a target of 35 to 40 per cent penetration on car sales and training is crucial in reaching those benchmarks.

‘What we do with dealers such as Allen Ford and Glyn Hopkin is show their sales people and managers how to work with the Supagard product,’ explains Abbott, Supagard’s south east divisional director. ‘We show how to introduce it in the deal, when to introduce it, and we teach product knowledge.’

But that’s only the first part.

‘We also introduce them to a full training programme which many companies do not do,’ continues Abbott. ‘With Supagard it is not just one training session and that’s it – we provide a full programme and we collate league tables for dealers to show which sales people are performing the best and who is underperforming.’

For the sales people who might be falling short of their targets, Supagard will implement a training programme to help get them back on track which normally consists of a training session once a month with someone like Abbott.

While dealers such as Allen Ford regard Abbott as one of the finest trainers on Supagard’s books, he’s not necessarily a man sales staff want to meet too often. ‘Sales executives and managers know that if they don’t up their game, they will be sharing a training session with me,’ Abbott jokes. ‘It’s a bit of a stimulus to sell more!’

However, that’s not always the case. Some dealers know that even the best sales people need constant training, and Supagard’s Abbott regularly meets such attendees. ‘I’ll chat to sales executives about how they have been

‘‘

Supagard will target the underperforming sales people and sales managers and give them refresher sessions to help them get back on track.

‘‘

selling Supagard’s products since I last saw them, and I can answer questions they may have.’

The reason why dealers like Allen Ford and Glyn Hopkin, along with many others, are so successful selling Supagard products is that their managers have got behind the product, and people like Abbot are on hand for support, advice and training.

That support and guidance is crucial in selling paint and fabric protection. While the sale of the vehicle may take precedence, many customers require protection packs to look after their pride and joy.

And if you don’t know what you’re selling, how can you possibly sell it?

Don’t be under the illusion Supagard’s training sessions are like the first day of term in an assembly hall. ‘We have a huge amount of fun,’ says Abbott. ‘Sweets are involved and we get the guys to stand up and do a bit of role play.’

Sales executives at different stages of their careers – newcomers to experienced hands – are split up so they are interacting with similar people.

Glyn Hopkin is another dealer group who highly recommends the work of Supagard and Abbott.

‘We’re very happy with the service they provide,’ says managing director of Glyn Hopkin Frazer Cohen. ‘We’ve been working with them since 1993 and throughout that time our main contact has been Terry. His enthusiasm is unbelievable and is probably the biggest thing behind our success with the firm.’

Some 25 of Glyn Hopkin’s sites use Supagard, which is a mark of recognition in itself, but a reflection of Supagard too. ‘We have had success with the product for two reasons,’ says Cohen.

‘Firstly because of the name – customers have an awareness of the brand – and secondly because of the training and support we have had.

‘I cannot emphasise enough the importance of Supagard training, and the fact that we have one point of contact with Supagard. The company’s enthusiasm for its product and for supporting dealers is infectious.’ [CD] For more information visit supagard.co.uk or call 0141 633 5933

CarDealerMag.co.uk | 69

Datafile CONTENTS.

Right click 73 Net Gains 75 Auctions 76 The Statistics 79 SMMT sales figures 81

Suppliers guide 82 Trader directory 84 Shares 87 Jobs 88 Sub-Prime Time 90

Advice n Data n Analysis n Facts n Figures n Comment

From joke to sales success Skoda’s sales are creeping up all the time and the firm is winning copious awards. James Baggott investigates what’s changed

F

rom laughing stock to serial award winners – Skoda has gone from strength to strength as sales across the world have rocketed. The Czech brand – once the butt of many poor jokes – has achieved a remarkable transformation since it became part of the powerful VW Group 20 years ago.

Last year the firm sold 762,000 new cars worldwide generating revenues of £7.6bn with profit of £394m. Wind back the clock five years and Skoda delivered 550,000 new cars, and back in 2001 461,000. It’s clear sales are going one way...

And the manufacturer won’t be stopping there. In the UK it plans to push sales over the 50,000 mark in 2012, up from the 41,000 cars it delivered in 2010.

But how has it managed to turn around its fortunes? Automotive expert Professor Garel Rhys, a director at Automotive PR, believes it was VW’s vision as well as promoting the strong links to its parent firm that were key.

‘Volkswagen really knew what it wanted to do,’ he said. ‘It really wanted to change it from just being seen as a low price brand, but this couldn’t happen overnight. VW heavily promoted its link to Skoda. Its adverts included the name of the

car and associated it with VW engineering, barely mentioning Skoda.

‘The next thing was to bring in a small Skoda logo, but focusing on the name of the model.

After the models had lifted their reputation, VW was then able to bring the Skoda name forward.

Today, the VW link is barely mentioned. Now it can continue to build its reputation based on products

‘VW wanted to change Skoda from just being seen as a low price brand.’

– but none of this was easy to achieve and took at least 10 to 15 years.’

It helps that the cars are really rather good. The four-wheel drive Yeti boasts a lengthy waiting list, while cars like the Fabia, Superb and Octavia all offer excellent value.

‘Skoda has earned a reputation for value-formoney products built to the highest standards, while being part of the Volkswagen Group has brought benefits,’ explained Skoda UK director

Robert Hazelwood. He added that the brand will now be unveiling a new model every six months and with recent successes such as hitting 226mph in a modified Octavia vRS at the Bonneville Salt Flats in Utah, pictured below, to shout about, things are looking very bright indeed.

It helps that customers love the cars too. Readers of Auto Express awarded Skoda the best overall manufacturer title in this year’s Driver Power survey and the firm also scooped gongs for its Superb and Yeti. Skoda has certainly got a bulging trophy cabinet – since 2000 it has picked up no less than 64 different awards!

Gongs and happy customers mean its dealers are smiling too. ‘When we opened our franchise in 1993 we knew we were making a sound investment – and we’ve been proved right,’ said Tony Slack of dealer Derek Slack Motors, one of the first to open in the UK. ‘We’ve seen a huge increase in demand for Skodas and we’ve had to keep up – moving to a bigger site in 2003 as business expanded.’

Heard the one about Skoda outselling Volkswagen? With growth like this, it might not be beyond a joke one day in the future...

CarDealerMag.co.uk | 71

RIGHT CLICK.

..in association with GForces

Tech will keep you ahead of the game

Dealers will need to use technology more and more to stay ahead of the game

Building brand loyalty is key for dealers – and software can help, explains GForces’ Tim Smith

A

recent Google aftermarket report showed that non-dealer third party retailers like Halfords, Kwik Fit and Mr Clutch took 50 per cent of the overall aftersales market due to better price, location convenience or brand loyalty.

This is not great news for a struggling motor retail sector. However, there is a lot for dealers to be positive about. The same survey from Google found 55 per cent of consumers still preferred dealerships over independents and other retailers because of their specific knowledge and expertise.

So what we have here is more a problem of trust and brand than a lack of ability to execute.

It seems there is an innate desire for consumers to buy aftersales services from dealers but they just don’t have that relationship or connection with their customers to stop them from straying to third parties. Dealers are perceived to be the experts but there are problems in how a consumer perceives a dealer in terms of price, brand and ultimately trust.

The problems are many. There are varied levels of services on offer from main dealers and an even more varied level of awareness of those services on behalf of the consumer.

If this is compared to say Kwik Fit it is very clear in the consumer’s mind they do exhausts, tyres, brakes and MOTs. This is often down to poor lifecycle marketing and badly administered customer relationship management by the dealership. A dealer should know when a service is due, what parts are typically required and more importantly, who the customer is. When I write ‘who the customer is’ I don’t just mean their name and address, I mean recognition of the fact they have purchased a high value good from the dealership in the past.

Another factor is the technology to automate a lot of the CRM headache has not really existed.

Sure there are numerous DMS, CRM and lifecycle marketing tools out there but they rarely talk to each other and simply create islands of disjointed information throughout the dealership. This means the true value of customer data is left untapped and relevant, targeted information rarely reaches the captive market.

To see how technology can be used effectively to build brand loyalty and lifecycle marketing we can look at Apple’s iTunes or Amazon’s customer portal. Your personal information is stored in

an accessible web account which includes past purchases, credit card details and detailed profile data. This is then used by the retailer to target you with relevant products and services. It works.

This sort of technology will be applied to the motor retail sector to tie up all the loose ends surrounding DMS and CRM records and provide live reminders to customers regarding MOTs, servicing and targeted promotional offers that they find useful, not irrelevant or annoying.

Technology is being used by the biggest and best companies in the world to open themselves up to the consumer. They not only provide quality products and services, they create a two-way communication that engenders trust and creates a relationship. From this relationship comes loyalty and ultimately revenue from the consumer. It’s time for this to happen in motor retailing.

Who is Tim Smith?

He is commercial director for serial award winners GForces. Learn more about how he can help you at gforces.co.uk or call 0845 658 9290.

‘Technology can be used effectively to build brand loyalty.’

DON’T LET THE COMPETITION RUB OUT YOUR AFTERSALES REVENUE 0845 658 9290

www.gforces.co.uk CarDealerMag.co.uk | 73

NET GAINS.

..in association with Codeweavers

Why we shouldn’t be afraid of failure Innovation is an illusion if all your new ideas are a success from day one When was the last time you tested something new on your website?

I

’d like to start things off with a question: How often do you test new ideas and functionality on your website? The reason I ask is that so many sites remain fundamentally unchanged and unaltered from the day they were created – no new content, designs, or taking account of new technologies, social media or platforms such as smartphones or tablets.

So this month’s column is about testing, and trying new stuff out. There are those businesses that do and those that don’t. Especially on the web. The problem with trying new ideas (not just on the web) and testing them is that most people are not given the freedom to fail or make mistakes.

If a company refuses to tolerate any margin for error, then all that happens is employees ‘play safe’ and only use methods and technologies that have worked in the past. Which will never drive that business forward in the long term.

Many businesses (not just technology companies, but motor industry firms as well) promote themselves as ‘innovative’. Well, I believe that there is a simple way to find out if they are – how many of their ideas are successful? If the answer to this question is ‘all of them’, then I’m afraid they are just ‘playing safe’ and not pushing the boundaries.

Try stuff. Test it. Evaluate it. Use the classic

‘Try stuff. Test it. Evaluate it. Use the ‘‘feedback loop’’ to see what works.’ ‘feedback loop’ to see what works. And then refine it.

Former England rugby coach Clive Woodward sums it up well. In his book Winning he says that normally when a project fails, there is a postmortem to find out why, and when a project is successful we go out and get drunk to celebrate.

He advocates turning this around – when an idea fails, let’s go out and get drunk to forget it, and if it succeeds then have a full post-mortem to establish exactly why it was successful, so the success can be recreated.

The reality is that there are many businesses that take this one step further and allocate budgets to see if ideas work or not. It’s commonly

called research and development, or R&D, and it isn’t limited to science companies or large organisations. It should be used by any company that’s keen to figure out what their customers want and how they think. It’s an investment that will fail sometimes, but I believe it’s essential to the future growth of an organisation.

The good news is that it’s possible for you to undertake this sort of activity. Your website and its content or functionality can be viewed as R&D in public. Just come up with ways of tracking the progress and effectiveness of aspects of your site, and fine-tune them over time. We shouldn’t be too quick to point the finger at any company that launches web initiatives that fail. In fact, we should be critical of those that don’t.

Who is Martin Hill?

Martin is commercial director at Codeweavers. Learn more about how he can help you at Codeweavers.net or call 0800 021 0888.

FULL OF IDEAS

0800 021 0888 www.codeweavers.net contactus@codeweavers.net

CarDealerMag.co.uk | 75

auctions.

Nissan Sunderland plant celebrates 25 years bit.ly/Sunderlandat25

Henstock

auction stations

Are dealers ready to serve needs of different clients?

O

ne of the major benefits of our long-term partnership with Prof Peter Cooke and the automotive group at the University of Buckingham is that it gives us an opportunity to sit back and actually think about the market we all operate in.

We all need a bit of thinking time and I highly recommend downloading The Long View report from the BCA website.

The report examines the relationship between the state of the country’s economy, used vehicle supply and the retail used car market (see story below right).

These are real issues that affect us all and none more so than those operating in the competitive arena of retailing big-ticket items.

However, used car dealers have an extra dimension to cope with – sourcing the stock in the first place.

The report examines how shifts in supply may affect the size and shape of the used car marketplace. Given the steep fall in new car volumes over the past three years, the report suggests there will be a big reduction in the supply of younger used cars in the short to medium term – which will affect used car prices and will inevitably lead to changes in dealer practices for sourcing vehicles.

The Long View suggests that dealers need to explore their options in an increasingly competitive marketplace for used cars and indicates that multisourcing will become standard practice. Dealers who don’t adapt may struggle to acquire the right stock at a competitive price.

The report also highlights the skills dealers need to compete in an increasingly complex marketplace. In any retail operation, the purchasing function is arguably the most important factor in operating profitably.

With the growing economic uncertainty and continuing high fuel costs, motorists want smaller, more economical used cars, yet used car retailers often find these vehicles the hardest to source profitably.

Are dealers ready to serve the differing needs and preferences of men, women and different age groups in terms of their stocking and sales approach?

‘Used car dealers have an extra dimension to cope with – sourcing the stock.’

Who is Simon Henstock?

Simon is UK network operations director for BCA. Visit british-car-auctions.co.uk or call 0845 600 6644.

76 | CarDealerMag.co.uk

Difficult conditions – no change there then!

Don’t over-value vehicles during the autumn, advises NAMA

T

he National Association of Motor Auctions (NAMA) expects market conditions to remain challenging in September.

Data from national members confirms that every year volumes start to increase from around the second or third week in September and peak in the first half of October – just as consumer demand traditionally weakens.

However, this year, demand might well be adversely affected by the continuing uncertainty surrounding the economy.

The summer saw a drop in available stock from dealer and fleet vendors, and demand for the limited supply has been just sufficient for average values to fall at a seasonally steady rate, with healthy conversions being maintained.

NAMA predicts that as volumes rise significantly in the weeks following the registration plate change, there is no indication that demand will increase over the same period.

NAMA is advising against over-valuing vehicles during the autumn, or holding on to stock in the hope values might improve.

Chairman Andrew Hulme said: ‘Market conditions have been relatively stable over the past two months, despite the fragile

‘Farming’ in focus BCA has published a major new report surrounding the economy and the used-vehicle market.

The Long View Report – written

by Prof Peter Cooke and the automotive group at the University of Buckingham – examines the relationship between the state of the country’s economy, the used vehicle supply and the retail used car market.

Cooke said: ‘The market is becoming more competitive and professional. It is ever more important to remember the basics of building, supporting and ‘‘farming’’ the customer base. It’s much easier and less expensive to retain existing customers than find new ones.’

confidence exhibited by consumers and wholesale buyers.

‘That is likely to change significantly as volumes rise and buyers have a much greater choice.

‘While well-presented grade one and two vehicles continue to attract strong bidding, stock in grade three to five condition needs to be accurately valued.’

NAMA vice-chairman Tim Hudson said: ‘As volumes rise, sellers know that it is vital to churn stock swiftly. Unsold and re-entered vehicles are anathema to professional buyers and the NAMA data re-enforces the value of maintaining a strong and consistent conversion rate through changing market conditions.’

NAMA council member Mike Pilkington agreed, adding: ‘Used vehicles do not exist in a vacuum and the difficult economic conditions will be affecting used car buyers in the same way they are affecting everyone else. Every vehicle sold should be seen as a success, particularly when volumes rise in the autumn.’

Tremendous outcome in challenging conditions MORE than 140 Mercedes-Benz and Smart vehicles have gone under the hammer at Manheim Auctions, Leeds. The sale attracted almost the entire Mercedes-Benz franchised dealer network and generated £3m with an average selling price of £21,588.

Barry Peat, head of used car remarketing at Mercedes-Benz UK, said: ‘Given the challenging market conditions, a conversion of almost 100 per cent and an overall result against CAP Clean of 111 per cent and against Glass’s Guide of 108 per cent was a tremendous outcome.’

For Manheim, James Leese added: ‘We are very pleased with the success of this latest closed auction at Leeds.’

3,000 dealers...and counting!

Since its formation in 2003, the WMS Group have certainly continued to live up to their reputation as the dealer’s favourite used vehicle warranty partner in the F&I sector.

More dealerships have come to us to help increase profit margins with some having reported a product penetration increase of over 60%, whilst retaining their customers for service and repair work. We have bespoke warranty products and solutions for all FSA and non-FSA registered dealerships - to see our product range, visit our website below or call our business development director Eric Stone on 07789 682502 or Malcolm McIntosh on 07770 343330 to find out how we can fit into your dealership. Whatever the shape of your business, we’ll provide comprehensive sales and compliance training under the FSA framework – it’s as easy as 1,2,3!

Tel: 0844

477 4909

www.WMSGroupUK.com

DATA FILE.

..in association with

Thestatistics Used Cars n Top 10 Searches n SMMT Sales Data

Welcome news as number of new cars registered goes UP F

or the first time in more than a year, the number of new cars registered has actually risen.

After 13 months of gloomy headlines quoting registration figures being down considerably, August’s announcement is welcome news indeed.

Overall, new car registrations for the month were up 7.3 per cent to 59,346 units. Private demand grew by 10.7 per cent with the Ford Fiesta leading the way.

The Blue Oval registered 3,213 cars in the month – a number which has helped the supermini segment rise by 17.6 per cent and now accounts for 37.3 per cent of the market.

However, in a statement, the chief executive of the SMMT, Paul Everitt, focused more on the prospects of September, rather than August’s success.

‘August represents a relatively small share of the new car market and the September new 61-plate registrations will be far more important for vehicle manufacturers and franchised dealers,’ said Everitt.

‘The September new car market is always important for the UK motor industry, accounting for around 17 per cent of the full year’s registrations.

Consumers are nervous about the future, but with the industry offering unprecedented improvements in fuel economy, competitive finance offers and a wide variety of new models, buyers will find there is something to suit every taste and pocket.’

Sue Robinson, director of the RMI

National Franchised Dealers Association (NFDA), went further, adding: ‘Although it is positive to see a rise in new car sales in August, the overall market remains challenging and consumer confidence remains fragile.

‘Feedback from NFDA members, who are franchised car dealers throughout the UK and are in continuous contact with consumers, is that new cars will sell if there are deals available and the purchase looks attractive.

‘Consumers are still nervous about purchasing big-ticket items but while interest rates remain low, some consumers do have disposable income to spare.’

John Leech, a partner in KPMG’s Automotive practice, also believed the first rise in registrations for 13 months was good news, but added: ‘Although the SMMT’s full-year forecast remains on track, the market is still fragile – manufacturers are recognising this and therefore are offering some great deals in the marketplace to keep consumers buying.’

For more analysis of the figures, please see overleaf.

Kelleher

Market insight

Managing those leads

E

arlier this month, we commissioned a piece of research with 1,000 car buyers to refresh our understanding of how they like to search for vehicles. Three things really stood out. Firstly, the volume of research activity that takes place ‘after hours’; secondly the preference of email as a preferred initial contact method with dealers; and thirdly the staggering volume of people who research online but whose first contact with a dealer is when they physically turn up on the forecourt.

In terms of the volume of out-of-hours searching, more than 53 per cent of the sample we surveyed did the majority of their research between 7pm and 11pm. Capitalising on this activity and converting it into sales remains a challenge.

Clearly dealers can’t answer the phone at all hours of the day and night, but there would appear to be scope to improve the industry’s reputation in terms of responding to emails sent by potential buyers. While over a quarter of all respondents told us that email was in fact their preferred method of initial contact with a dealer, the data also showed that some dealers were losing out on potential sales by failing to respond to these inquiries by email, with a remarkable 79 per cent of potential buyers who had sent an email to a dealer claiming never to have received a response.

The other interesting finding was that a whopping 75 per cent of respondents claimed that when they had found a car online that they were interested in, the first interaction they had with the dealership was when they turned up on the forecourt to view that vehicle.

While online sites like ours place great emphasis on ‘return on investment’ from being able to track telephone calls and emails generated, our advice to dealers now more than ever would be to ensure they also have a good lead management solution in place so that they can accurately see the value of their advertising activity in the round.

Who is Dermot Kelleher?

He is head of research at Motors.co.uk. Find out more about how the portal can help you on their website or call 0845 265 6000.

sales@motors.co.uk

0845 265 6000 www.motors.co.uk/mediacentre

CarDealerMag.co.uk | 79

DATA FILE.

Thestatistics Used Cars n Top 10 Searches n SMMT Sales Data

The most searched-for cars on Motors.co.uk

Now let’s see if September is as successful as August!

A

Most popular manufacturer 1 Ford 2 Vauxhall 3 Volkswagen 4 BMW 5 Peugeot 6 Audi 7 Mercedes-Benz 8 Toyota 9 Mini 10 Renault Most popular models 1 Ford Focus 2 Ford Fiesta 3 BMW 3 Series 4 Vauxhall Corsa 5 Vauxhall Astra 6 Ford Mondeo 7 Peugeot 206 8 Renault Clio 9 Audi A3 10 Honda Civic most popular sub £10k cars 1 Ford Focus 2 Ford Fiesta 3 Vauxhall Corsa 4 Vauxhall Astra 5 Peugeot 206 6 Renault Clio 7 Volkswagen Polo 8 Vauxhall Zafira 9 Peugeot 207 10 Ford Ka

ugust’s rise in registrations has prompted a car industry expert to declare it as a ‘welcome surprise’.

With most economic indicators looking bleak, the fact that car registrations rose 7.3 per cent in August could mean brighter times are on the horizon for the car industry, believes David Raistrick, UK manufacturing leader at Deloitte.

‘The new car registrations for the month of August came as a welcome surprise,’ said Raistrick.

‘While fleet sales have held firm in 2011 thus far, retail sales have been down and, with a combination of the holiday season and private buyers waiting for the new registration plates to be introduced in September, it was never expected to be a great month.

‘August is also typically one of the quietest, with an average of around 50,000 new car registrations.

‘August generally represents a relatively small share of the new

We have reached a ‘tipping point’ where it makes sense for customers to buy new

car market with September being a far more crucial month for the automotive retail industry.

‘On average around 350,000 new cars are registered.

‘After nearly a year of falling sales, I expect September to mirror the August increase and we are likely to see numbers slightly up from last year.

‘This is due to a number of different factors including several new models coming on stream, interest rates remaining low and a “tipping point” having now been reached – the point where it makes sense to buy new, with private consumers having held off for a considerable time.

‘I also see the fleet market remaining firm in September. Added to this, manufacturers are continuing to do well with steady demand from external markets like Russia and China counteracting the slowdown in new car sales across Europe and North America.

‘Looking to the future, our forecast is for a good September with a rise over last year.’

Latest figures show a double triumph for Ford’s Fiesta THE Ford Fiesta continues to reign supreme both in the monthly and year-to-date registration figures.

In August – which saw registrations rise for the first time since June 2010 – Ford sold 3,213 Fiestas.

In second place was the Vauxhall Corsa with 2,901 units to its name,

and following not far behind was Ford’s Focus with the Blue Oval shifting 2,858 units.

In fourth place was the Volkswagen Golf with 1,995 cars sold, followed by the BMW 3 Series (1,739), Vauxhall Astra (1,613) and the Volkswagen duo of Passat and Polo selling 1,526 and 1,467 cars

respectively. The Nissan Qashqai finished in ninth place with 1,312 and the top 10 list was rounded off with a surprising entry – the Audi A3 which sold 1,125 units in the month of August.

With 61,551 units to its name, the Fiesta still holds the number one spot too in the year-to-date table.

sales@motors.co.uk

0845 265 6000 www.motors.co.uk/mediacentre 80 | CarDealerMag.co.uk

..in association with CHEVROLET renault AUGUST august 115.42% -44.00%

SMMT sales data August/year to date

Figures supplied by SMMT

August Marque

Abarth Alfa Romeo Aston Martin Audi Bentley BMW Cadillac Chevrolet Chrysler Citroen Corvette Daihatsu Daimler Dodge Fiat Ford Honda Hummer Hyundai Infiniti Jaguar Jeep Kia Land Rover Lexus Lotus Maserati Mazda Mercedes-Benz MG MINI Mitsubishi Nissan Perodua Peugeot Porsche Proton Renault Saab SEAT Skoda smart Ssangyong Subaru Suzuki Toyota Vauxhall Volkswagen Volvo Other British Other Imports Total

2011

38 334 45 3,774 36 3,873 0 489 78 2,904 0 0 0 0 1,402 8,552 985 0 2,016 13 188 40 1,777 381 133 9 13 930 2,147 21 1,399 191 2,651 31 3,149 197 22 1,657 92 1,022 1,742 150 1 34 630 2,201 6,980 6,238 650 104 27 59,346

% market share

0.06 0.56 0.08 6.36 0.06 6.53 0.00 0.82 0.13 4.89 0.00 0.00 0.00 0.00 2.36 14.41 1.66 0.00 3.40 0.02 0.32 0.07 2.99 0.64 0.22 0.02 0.02 1.57 3.62 0.04 2.36 0.32 4.47 0.05 5.31 0.33 0.04 2.79 0.16 1.72 2.94 0.25 0.00 0.06 1.06 3.71 11.76 10.51 1.10 0.18 0.05

Year to date (YTD) 2010

% market share

2011 % Change

51 184 56 3,173 25 3,825 0 227 28 3,072 0 3 0 18 1,044 7,245 1,432 0 1,503 17 279 32 1,464 523 113 20 19 1,512 1,886 9 753 250 2,667 34 3,477 125 36 2,959 92 890 1,285 244 5 47 602 2,222 6,247 4,866 667 55 22 55,305

0.09 0.33 0.10 5.74 0.05 6.92 0.00 0.41 0.05 5.55 0.00 0.01 0.00 0.03 1.89 13.10 2.59 0.00 2.72 0.03 0.50 0.06 2.65 0.95 0.20 0.04 0.03 2.73 3.41 0.02 1.36 0.45 4.82 0.06 6.29 0.23 0.07 5.35 0.17 1.61 2.32 0.44 0.01 0.08 1.09 4.02 11.30 8.80 1.21 0.10 0.04

-25.49 81.52 -19.64 18.94 44.00 1.25 0.00 115.42 178.57 -5.47 0.00 -100.00 0.00 -100.00 34.29 18.04 -31.22 0.00 34.13 -23.53 -32.62 25.00 21.38 -27.15 17.70 -55.00 -31.58 -38.49 13.84 133.33 85.79 -23.60 -0.60 -8.82 -9.43 57.60 -38.89 -44.00 0.00 14.83 35.56 -38.52 -80.00 -27.66 4.65 -0.95 11.73 28.20 -2.55 89.09 22.73 7.31

818 7,516 710 73,736 716 72,543 0 8,429 444 43,429 0 3 0 0 27,167 171,278 29,874 0 37,529 202 8,042 1,227 33,524 22,454 4,561 272 270 19,962 49,789 184 28,457 6,789 58,611 378 60,998 3,653 333 42,096 3,774 22,250 29,347 3,263 11 1,601 12,401 45,099 150,641 114,209 20,672 766 590 1,220,618

%market share

0.07 0.62 0.06 6.04 0.06 5.94 0.00 0.69 0.04 3.56 0.00 0.00 0.00 0.00 2.23 14.03 2.45 0.00 3.07 0.02 0.66 0.10 2.75 1.84 0.37 0.02 0.02 1.64 4.08 0.02 2.33 0.56 4.80 0.03 5.00 0.30 0.03 3.45 0.31 1.82 2.40 0.27 0.00 0.13 1.02 3.69 12.34 9.36 1.69 0.06 0.05

2010

%market share % Change

910 4,535 721 65,850 665 63,376 20 8,949 895 46,362 2 136 2 526 34,492 184,037 40,099 1 43,384 95 10,204 1,231 39,266 25,002 4,106 358 317 29,199 44,794 218 25,253 7,119 55,411 541 70,925 4,351 550 61,566 2,965 20,770 27,064 4,950 206 2,430 13,144 57,311 156,388 113,510 24,945 772 490 1,300,413

0.07 0.35 0.06 5.06 0.05 4.87 0.00 0.69 0.07 3.57 0.00 0.01 0.00 0.04 2.65 14.15 3.08 0.00 3.34 0.01 0.78 0.09 3.02 1.92 0.32 0.03 0.02 2.25 3.44 0.02 1.94 0.55 4.26 0.04 5.45 0.33 0.04 4.73 0.23 1.60 2.08 0.38 0.02 0.19 1.01 4.41 12.03 8.73 1.92 0.06 0.04

-10.11 65.73 -1.53 11.98 7.67 14.46 -100.00 -5.81 -50.39 -6.33 -100.00 -97.79 -100.00 -100.00 -21.24 -6.93 -25.50 -100.00 -13.50 112.63 -21.19 -0.32 -14.62 -10.19 11.08 -24.02 -14.83 -31.63 11.15 -15.60 12.69 -4.64 5.78 -30.13 -14.00 -16.04 -39.45 -31.62 27.28 7.13 8.44 -34.08 -94.66 -34.12 -5.65 -21.31 -3.67 0.62 -17.13 -0.78 20.41 -6.14

CarDealerMag.co.uk | 81

data file.

Alex Goy

all torque

A bit of clever PR will get more buyers to your door

S

o it’s September – we all know what that means... plate-change time. Or, as I like to call it – spot the punter who wants to wee all over the Joneses’ 11-plate Astra.

A recent chat with Ford’s PR boss revealed that Ford sells more cars in September than any other month. That means that the 403,650 Joneses in the UK could well have woken up to a new Fiesta sitting outside the house next door on September 1.

But spare a thought for the manufacturers who aren’t going to be having an easy month. Saab, for example, is in such dire straits that anyone who walks into a dealership may be offered a car at cost price just to get it out of the door. But a new 9-5 with all the toys isn’t going to make up for a collapsing company. That said, everyone who drives a Saab can be classified as ‘nice’. But if all these ‘nice’ people love their Saabs so much, why aren’t they buying more? Just a thought...

Kia will have a good one. The new Picanto is cracking. There’s a three-door on the way, too.

And, if dealers are smart, they will have read up about the preplate change. ‘You can have this now, or wait a bit and get the newer model...’

However, the best thing about the whole affair is this: Spotting your first new plated car. It’s a fun, geeky and terrible game. But the trick to it is spotting the best car you can. Got an Aston? Then you win. Spot an ill-fated Saab 9-3? Oh dear, round two is in six months, son.

I digress – how are you going to make sure your dealership gets decent footfall? Well, much of it is out of your hands, sadly. If you’ve no new product on the floor (Honda, you listening?) or a simply uninspiring range (Vauxhall, your turn for a shout-out, sorry...) then it might not be the greatest of Septembers. That said, there’s still an audience who needs a new car and knows chuff-all about them. Get your local rag down to drive the range. A staffer would love an afternoon out driving, rather than reporting on parish council meetings. A spot of clever PR will get buyers out of competitors’ lots and on to yours.

A little bit of investment here will get footfall through the roof. And you don’t even need to have a ‘family day’ to do it.

‘There’s still an audience who needs a new car and knows chuff-all about them.’

Who is Alex Goy?

He‘s a motoring journalist with a lot to say. He also produces a brilliant podcast. Check it out by typing bit.ly/alexgoy into a browser 82 | CarDealerMag.co.uk

Suppliers Video

Video

Call Solutions

C It Now

AutosOnShow.TV

Intelegent

Auctions

Auctions

Badges

BCA

Manheim Remarketing

Badgemaster

Cleaning Equipment

Online Trading

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Kärcher UK Ltd

Autotrade-mail.com

CARS

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Autotorq.com

GForces

Webzation

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The original and the best. Call for your free two week trial.

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mini test: Lexus CT 200h

Display Products

Cleaning Products

Car dealer says HHHHH

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Drymotive

Online Advertising

Valeting Services

HugoFox.com

AutoKlean

It’s the world’s first full hybrid in the premium compact sector garnished with all the luxury and refinement of more expensive Lexus cars. It’s going to be the most popular Lexus ever, and there’s no denying that the CT 200h is an impressive package in an otherwise boring market.

The car is far posher than a Prius, but the family relationship also means that the CT is not that enjoyable to drive. Impressive ownership costs will make the car appealing, but if

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customers are interested in driving, the faster, but slightly costlier BMW 118d is far more tempting.

Price: £25,200, tested in Issue 38

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Insurance

Auctions

Key Cabinets

Vehicle Remarketing

Automotive CRM

Think Insurance

HBC

Keytracker Ltd

mfldirect.co.uk

Contact Advantage Limited

Finance

Smart Repair

Warranties

mini test: Hyundai ix20

First Response

Junair Spraybooths

WMS

Car dealer says HHHHH

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10% new client discount. Liabilities.

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Junair can supply a complete range of equipment at competitive prices for Smart and wheel repairs.

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Finance

Telemarketing

Online Advertising

DSG Finance

On Target

Netcars.com

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This is the sister car to the superb Kia Venga, but comes with added Hyundainess. Like its other brothers, the ix20 is a delight to drive; easy in the city and capable on the motorway. The 1.4-litre petrol is perky too.

The Independent said it’s ‘a pleasingly designed utility object’, while Autocar said ‘it comes highly recommended’. The Korean firm has entered a highly-competitive market place with a car that really delivers. But we prefer the cheaper, better-looking and seven-year warranted Kia Venga.

Price: £13,990, tested in Issue 38

Finance

Warranties

Finance

Advertise Here

Black Horse

Car Care Plan

Moneybarn

Your company name

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Getting your company featured here is more affordable than you imagine. Here’s why

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CarDealerMag.co.uk | 83

data file.

James Litton trader tales

All we want is a price cut but will Auto Trader listen?

A

s a follow-up to my stinging article in the August issue, I recently had a meeting with a regional director of Auto Trader. The fact that senior figures within Auto Trader were prepared to engage in anything other than rudimentary business calls is a credit to the company, but the meeting did nothing more than highlight why the majority of car dealers are so unhappy.

Our disagreement focused on the current pricing structure and the perception of value. Auto Trader say that their figure of around £9 a week per car is excellent value compared to spending £100 a week on a regional press title or in my case the cost of a used car display area. They also argue that a number of pricing and analytical tools are available to me, they have the highest number of unique visitors AND I have a ‘trusted advisor’ (crappy corporate speak for a rep) to visit me and talk through my needs. The visit also involved the introduction of a ‘customer charter’. ‘We want to hear your feedback so that we can improve our service, very much like the NatWest initiative’.

I used to fly with BA but rarely do today. I liked the fact that I had a seat, that the cabin crew were polite and professional and that they had an excellent safety record. What budget airlines did was strip the offer down to the base level but the product remained the same. Now I find it very difficult to justify the difference. ‘But BA had a good year last year,’ said the director when I used this analogy.

My prediction is not that Auto Trader will cease to exist – I still have an account albeit reduced – but like BA they will lose their market position. It is not enough to assume that service and market dominance will ensure the success of any company. I am happy to pay more for Auto Trader than I would a competitor as I accept their current position as market leader – but not 10 times as much.

The irony of the introduction of a customer charter should not be lost on anyone. Every dealer in the land is screaming for a reduction in price but will they listen?

‘My prediction is that, like BA, Auto Trader will lose their market position.’

Traderdir Alfa Romeo

Alfa Romeo

Aston Martin

Sturgess Alfa Romeo

Benfield Alfa Romeo

Aston Martin

Aston Martin

Audi

Audi

HWM Aston Martin

Wimbledon Carriage Company Limited

Walton & Epsom Audi

John Crisp 07885 211872

Mark Loughnane 01932 220404 07739 519306

BMW

BMW

Bentley

Williams Rochdale

Vines Group

Harwoods

Bentley

Chrysler

Daihatsu

Jack Barclay Bentley

Horsham Car Centre

Alan Nicholas 07703199478 alan@horshamcarcentre.co.uk Best buyer for all late Chrysler/ Jeep

Stephen Barnard 0208 504 0017

Daihatsu

Ferrari

Ferrari

Proven Daihatsu

HR Owen Ferrari Nick Carey

Scott Allen 0116 275 8800 scottallen@ sturgesscars.co.uk n Buying used Alfa Romeos up to five years old

Paul Spires paul.spires@hwm.co.uk 01932 240611 07850 326755

Craig Fenlon 01706 717700 07808 092110

Derek Bennett 020 7629 7444 07713 887 88

Keith Pattison 01428 652554 07771 547406

Dax Pearce dax.pearce@Benfield motorgroup.com Alfa stock wanted up to 40,000 miles. n Call for immediate bid. 07501 257220 or 0191 211 2200

Dominic McConnon 07776 246905 dominic.mcconnon@ vinesguildford.bmw-net.co.uk n Buying used BMWs up to five years old

Mangoletsi (Holdings) Limited Fraser info@mangoletsi.com 01565 722899

Simon Elkin 01798 877211 07803 088711

Woodford Motor Co Ltd

Monza – Ferrari

nick.carey@hrowen.co.uk 07824 362229

Andrew Ludlow ferraribuyer@ntlworld.com 07889 305 053

Ferrari

Fiat

Fiat

Maranello Ferrari

Glyn Hopkin Ltd

Sturgess Fiat

John Dutton 07817 019 456

Glyn Hopkin 07730 711889

Ian Callis 0116 254 1717 icallis@sturgess cars.co.uk n Buying used Fiats up to five years olds

Who is James Litton?

James runs theinternetcarlot.co.uk. He's been in the business for 12 years and always has something to say about the industry he loves.

84 | CarDealerMag.co.uk

To have your details included here log on to CarDealerMagazine.co.uk/trader-directory.htm

ectory

Finding the right cars at the right prices isn’t always that easy. On top of that, selling cars that you don’t necessarily want to put on the forecourt can be tough too. Our Trader Directory aims to alleviate these problems.

Instead of thumbing through endless pages in

price guides looking for the right trader, you can consult the Trader Directory, either in the magazine or online, and find them right away.

If you’d like to be included you can submit your details in the Directory find out how at the bottom of this page.

Ford

Ford

Ford

Honda

Honda

Benfield

Benfield Alfa Romeo

Lifestyle Ford

Honda

Thames Honda Group

Honda

Hyundai

Hyundai

Jaguar

Jaguar

Holdcroft Honda

Bushey Heath Hyundai

Hatfield Hyundai

Sturgess Jaguar

Charles Hurst Jaguar

Jeep

Kia

Kia

Lexus

Land Rover

Horsham Car Centre

Tower Hill Garage

Chapelhouse Kia

Lexus Twickenham

Sturgess Land Rover

Des Sammon des.sammon@benfield-ford. co.uk 07831 828024

Luke Regan / Chris Thursfield 07971 543884 07813 737 921

Alan Nicholas 07703199478 alan@horshamcarcentre.co.uk Best buyer for all late Chrysler/ Jeep

Dax Pearce dax.pearce@Benfield motorgroup.com Alfa stock wanted up to 40,000 miles. n Call for immediate bid. 07501 257220 or 0191 211 2200

Jon O’Donoghue 0208 420 5100 07976 177 959

Lee Gilmour 01923 263700 07768 367085

Richard Walker 07748 177889

Mark Littler/Tim Barnes 0161 767 9500 07920 599 394 07787 921 222

Andy / Neil 01925 570800 07891 531129 07825 311 297

Brayley Honda Mark Corr 07812 342 635

Chris Allen chrisallen@sturgess jaguar.co.uk 0116 282 6868 n Buying Used Jaguars up to five years old

Dave Cooper / Steve Gurr 07831 704134 07921 408983

Jerome Chandiram 0208 845 3551

Stewart Begg 0208 938 1300 07534 927 821

Chris Allen chrisallen@sturgess jaguar.co.uk 0116 282 6969 n Buying used Land Rovers up to five years old

Land Rover

mini test: clio gordini

Lotus

Maserati

Beadles Land Rover

Car dealer says HHHHH

Murray Motor Company

Meridien Modena

Greg Wilcox g.wilcox@beadles-landrover. co.uk 07740 717209

There’s no doubt the Clio Gordini is a great car to drive, but the Gordini ‘look’ is contrived and nasty.

Graeme Robertson 0131 200 8888 07765 252745

Warren Butt 02380 283404 07860 530703

Price: £20,220, tested Issue 38

Maserati

Mazda

Mini

Mitsubishi

Nissan

HR Owen

Lifestyle Mazda

Vines Group

North City Autos (Chingford)

Nissan

Ed Tyrrell 020 8524 8855 07736 610285 n Interested in low mileage FSH vehicles

Sturgess Nissan Ian Callis 0116 254 1717 icallis@sturgess cars.co.uk n Buying used Nissans up to five years olds

Nick Carey nick.carey@hrowen.co.uk 07824 362229

Mark Spowage 01293 845045 07974 770020

Dominic McConnon Buying used MINIs up to 5 years old 07776 246905 dominic.mcconnon @vinesguildford.bmw-net.co.uk

Toyota

Volvo

General

General

Want this spot?

Currie Motors Toyota

Sturgess Volvo

Sol Cars

Barry Freedman

Your advert here

Dave Cooper / Steve Gurr 07831 704134 07921 408983

Scott Allen 0116 275 8800 scottallen@ sturgesscars.co.uk n Buying used Volvos up to five years old

There’s also a more comprehensive list of traders on the website, updated throughout the month

Tim Hancock 07973722243 timfoxhancock@btopen world.com n Wanting part exchanges of all types up to 4k

01753 543105 07836 338694 barry.freedman@virgin.net n Trade buyer of PX vehicles anything up to £8k

Making sure you’re in front of other dealers when they need to trade their cars on is vital. And for £30 per month can you afford to miss out?

Prices for six month listings: £29.99 On Website Or £39.99 for Magazine & Website.

Payments can be made online via credit or debit card. Or send your cheque made payable to Blackball Media Ltd to Car Dealer, 2a Church Road, Gosport, Hants PO12 2LB. Your details will appear in the next issue.

CarDealerMag.co.uk | 85

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We’re no closer to the light The tough times are continuing... and that’s affecting stock prices

C

hallenging and volatile. That was how Vertu described the UK consumer environment when commenting on the outlook whilst announcing a small acquisition at the end of August. I think there are very few within the motor sector who would disagree. The retail environment is very tough and this is having a significant dampening effect on motor retail stock prices. The light at the end of the tunnel appears a pinprick which has moved further away from motor retailers over the past six months.

Until there is a greater consensus on when the retail environment will recover, all of the listed businesses have been concentrating on getting their own houses in order and have seen depressed share prices as a result.

At the start of August, most of the motor retail stocks took a significant drop on the back of the Pendragon slides and greater concern over the retail environment. However, there has been a

pleasing bounceback in most during the course of the month as retailers show they can make a profit and deliver on market expectations in spite of the difficult market.

Pendragon completed the raising of £75m through a rights issue at 10p per share.

However, the fact that 32 per cent of the current shareholders did not take up their options is going to produce a potential issue for the business. About 17 per cent of the business is now owned by the issue’s underwriters who will naturally look to unwind this position.

This is likely to depress any share price growth which you would expect from improved performance unless the underwriters can be convinced to hold onto the shares.

Also during August Pendragon released a positive set of results for the first half of 2011. To stabilise the price and show their commitment to the business, the directors were active in acquiring additional stock during August – £2.1m-worth to be precise.

Lookers also released a positive half-year statement showing results holding steady from the previous year. Growth in the parts division was offset by a weaker car sales result. However,

this still produced positive noises from brokers and analysts. Concentration on driving profit and maximising cashflow is a strong message in the current environment and this has produced a recovery in the share price.

The other major announcement in the month came from Cambria who announced that their venture capital backer Promethean, who hold 33.3 per cent of the shares, wishes to sell. This appears more down to political issues at Promethean rather than Cambria, but will naturally have a depressing effect on the share price.

The September numbers are usually key to overall annual performance. Given the likely level of self-registration activity which is going to take place during the month, the SMMT statistics may appear relatively rosy assisting share prices.

It is only when the retailers find real homes for these vehicles that we will see the profit impact of the registration exercises and whether there will be any significant impact on share prices.

Who is Mike Jones?

He‘s executive chairman of ASE Global. If you want to talk to him about his column call 0161 493 1930

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Advice

cars

data fiLe.

Doom and gloom alert – but there are still opportunities

T

he last time we had worldwide financial turmoil was when the big banks were tottering. Now it’s moved to a different level, countries are struggling and that’s after the various central banks have already pumped trillions of pounds into the world economy to stimulate growth – but without any sustained improvement.

Over the last few weeks the US has managed to just avoid a default, the European Central Bank has bought government bonds for the first time since March, and the Bank of Japan intervened in the currency markets to bolster the yen.

In the UK, the various indices that track economic fluctuation are not providing a rosy picture, and the effects of the austerity measures that are currently in the pipeline are only just being felt. I’ve seen a few ‘upbeat’ articles in the press over recent days forecasting that we won’t go back into a recession but even these aren’t expecting growth in the short to medium term.

So it’s probably appropriate to dust off the plans made in 2008/09 and prepare for the inevitable backlash in consumer confidence and a further reduction in consumers’ buying appetite.

With concerns once again over customer stability, finance companies will gravitate towards ‘ultra-prime’ new customers while also focusing on ‘known’ good risk customers for renewal opportunities, and will be targeting these ‘known customers’ directly. Dealers should consider their own marketing strategy to contact the customers they dealt with 24 to 48 months ago (especially if they sourced funds from a finance company with their

own or affiliated retail sites). I urge dealers to re-establish relationships quickly, and let customers know you’re ready to help them again when they are ready to buy. If the customer’s not renewing yet, get a diary date to contact them and leave the door wide open for them to return.

With the non-standard customer market growing and prime customer market slowing once more, dealers need to be certain what customer niche they’re attempting to attract, and where they’ll be able to finance them; stocking accordingly, and developing forecourt appeal designed specifically for their target market.

With unsecured lending once again being withdrawn

Don

Brough sub-prime time

‘Let your customers know you’re ready to help them again when they are ready to buy.’

(I know there’s been talk of a resurgence in personal lending, but I’ll believe it when I see it in this market) point of sale finance will become even stronger, so make sure all your sales staff are making the most of this and offering every customer this source of valuable funds. If you’ve been allowing a third party to place your business and take some (if not all) of your commission, this might be a good time to re-consider direct relationships with your finance providers.

I know this sounds ‘doom and gloom’ but I believe that if you don’t face up to the potential realities of any given situation, you won’t have fully considered the options available to not only deal with the downsides but also to maximise the upsides.

Who is Don Brough?

Don is chief executive officer of First Response Finance. For more information visit frfl.co.uk or call 0115 946 6370

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