This year has been a surprising one for the trade in many ways. Even the most optimistic of car dealers could never have predicted the rapid uplift in used car prices between late 2008 and most of 2009.
Even though the scrappage scheme was in effect a government subsidy for an ailing business sector and kick started demand for certain new cars, the general feeling in the trade has been one of optimism and profitability.
However although this may be the case for many large dealer groups with a diverse spread of brand partners what about smaller dealers in more rural or depressed regions of the UK? How about the independent dealers? They have suffered from the fact that car supermarkets, with massive financial muscle, have made it very difficult to make a living during the better times never mind when there is a recession.
The story always has a different middle and a different end for different dealers and although in many main dealers there have been redundancies and wage caps they have been able to be resilient enough to cope with the change.
At the other end of the scale people have, quite simply gone out of business and lost everything. With dealer funding withdrawn for only the very safest of bets many businesses have not even been able to borrow their way out and good traders who have been in the trade for decades and who possess a wealth of knowledge and experience have just not been able to cope with all the factors threatening them. These people have either been lost to the trade forever or have had to go back to where it all began in a dealership working for someone else.
We have heard from many people this year who dispute that lots of cars are being sold very profitably, because they reside in places where there are a distinct lack of chimney pots and unemployment is way above the national average. To them it has all seemed like a sick joke, but the reality is the big will survive and thrive and grow and the smaller, weaker dealers will get taken over or fall by the wayside and certainly if you look at both franchised and independent dealers there will be without doubt a fraction of the amount there was even 10 years ago.
With the rise of internet marketing car makers don’t need to close off open points and with more competition generally and customers prepared to travel further perhaps this is just part of the natural evolution that the car trade is going through.
In a retail motor trade shakedown the smallest will inevitably fall through the cracks.
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