Motor Trade Dealers Turn It Around In May

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The figures are in for dealer profitability for May 2018 and they make much better reading than this time last year.

Just 12 months ago retailers in the motor trade market place were averaging a loss of £17,000 but this year it looks like we may have turned the corner with dealers averaging a profit of £300. True this figure is not going to set the world alight, but it is very significant following April’s good news. Is a trend forming – well we hope so.

ASE Chairman Mike Jones said  “Despite the fact that May, being a mid-quarter month, is never going to produce huge levels of new car sales the result for May was comparatively positive, significantly outperforming 2017,” The good news has put a lot of Car Dealers in a much more positive mood including part time car dealers.

It is always positive to see signs of profit coming out of the new vehicle sale registrations but this can be very variable between franchises. Hopefully this will continue on into June as there have been a lot lower level of self-registrations.

It is also a good sign that the market place for used vehicles has also shown positive signs of movement for May 2018. Dealers were looking to take smaller gross profit margins as a trade-off for higher sales volumes and not investing as much money in stock levels should see the stock turnover levels increase.

It may be too early to tell if this is an ongoing trend as we really need to see the June 2018 figures to establish what the general picture is moving forward.

The levels of registration for June 2018 were lower than that of the same time last year but this can be explained by the lack of volume of last day registrations so hopefully overall performance for the month will still show strength with less self-registered vehicles being taken into the third quarter of the year.