UK car dealers remain confident about business prospects despite Brexit uncertainty
- Close Brothers Motor Finance quarterly dealer satisfaction survey finds 95% of dealerships are confident about market prospects for 2019
- Stability, expansion of new vehicle types and new finance products are amongst the biggest opportunities in the year ahead
- However, the proportion of dealers with concerns about Brexit, changes to legislation and regulation, and stock availability has increased significantly in the last year.
New findings from the Close Brothers Motor Finance’s Dealer Satisfaction Survey reveal that the vast majority of motor dealers (95%) are confident about business prospects in the market for 2019, up from 93% last year. Of these, six in ten (60%) are ‘very confident’ about the business outlook for the year ahead.
However, while the broad picture is one of confidence, there were some issues that have become more prominent in the last year. The research found that concerns about Brexit have increased significantly, with 35% of dealers seeing it as the biggest threat to their business, up from 26% last year.
Similarly, the proportion affected by legislation and regulation has almost doubled from 9% last year to 16%, and those worried mostly about stock availability has shot up from 3% to 10%. The impact of the WLTP legislation, which significantly impacted the availability of diesel and petrol cars in the new and used market, is clearly a factor
Interestingly, the perceived threat of an economic downturn has dropped from 17% in 2018, to 8% now. More dealers are keen to focus on maintaining stability (14% to 24%), and one in six (35%) are keen to expand their offering to new types of vehicles. This reflects the increased sales figures for alternatively fuelled vehicles from the SMMT over the year.
Commenting on the findings, Sean Kemple, Director of Sales at Close Brothers Motor Finance said: “Our quarterly Dealer Satisfaction Survey is a granular look at the current sentiment of dealers in the UK, and provides us with real insight into current and future priorities of dealers nationwide. Despite many warning of post-Brexit gloom, the UK’s dealers remain resolutely optimistic about the future success of the sector.
“Of course the threats to the sector cannot be ignored, and it’s no surprise that we’ve seen increased dealer concern about legislation and stock availability in reaction to WLTP. Car manufacturing and registrations alike have suffered, and dealers’ bottom lines have subsequently done the same. But there is hope to be had. Ripe opportunities exist in expanding the forecourt to meet evolving consumer demand, be that new fuel types, new models, expanding the used stock selection, or an enhanced after-sales proposition. To seize these opportunities, dealers must establish themselves as a source of expertise and reassurance to customers.”