UK car dealers confident about business prospects in 2018
Exclusive findings from Close Brothers Motor Finance’s Dealer Satisfaction Survey reveal that the majority of motor dealers (92%) are confident about business prospects in the market for 2018, up from 63% last year.
The Dealer Satisfaction Survey is a continual telephone survey undertaken by Close Brothers Motor Finance and reported on a quarterly basis. The survey questions 200 new and used dealerships across the UK to help provide a picture of dealer trends and help Close Brothers Motor Finance improve their service.
This iteration of the survey – undertaken between August and October – asked dealers about their business performance, their prospects for the year ahead, and what they see as the biggest challenges and opportunities for their business.
The research found that one in seven (14%) dealers see the expansion of the different types of vehicles on offer and maintaining stability (14%) as the two biggest opportunities for the year ahead. One in ten see the proliferation of new finance products and a similar number (9%) see changes in consumer behaviour as the biggest opportunity for 2018. Interestingly consumer behaviour is seen as both an opportunities and a threat for dealers.
Conversely, a fifth (21%) believe Brexit is the greatest threat to their business over the coming 12 months, followed closely by an economic downturn (17%) and legislation and regulation (11%).
Despite this, the survey found that 57% of dealers are very confident and four in ten (40%) are fairly confident about the business outlook for their own firms in 2018.
Opportunities for 2018
Maintaining stability (14%)
Expanding offering to new types of vehicles (14%)
New finance products (10%)
Changing consumer behaviour (9%)
Increasing sales (5%)
Specific opportunities: fleet cards, electric cars, local area (5%)
Higher affordability of motor vehicles (5%)
More marketing/ advertising/ online (4%)
Threats for 2018
Economic downturn (17%)
Changing consumer behaviour (8%)
Increased competition (4%)
Stock availability (3%)
Interest rates (3%)
Increased pre-approved finance offering (2%)
Outlook for diesel cars (2%)
Commenting on the findings, Chris Bosworth, Director of Strategy 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. With technology evolving, consumer behaviour changing, and the heightened political and economic uncertainty since the Brexit vote last year, it’s positive that dealers are feeling confident for the year ahead.
“It’s interesting that dealers cite the expansion of the new types of vehicles on offer as one of the biggest opportunities for their businesses. The government’s decision to tackle pollution by imposing a ban on all new petrol and diesel cars and vans from 2040 has already had a meaningful impact on motorists buying behaviour. Since the announcement this summer, the SMMT has reported consecutive decreases in the sale of new fossil fuel vehicles whilst renewable energy vehicles have grown in popularity month on month. With consumer support for these vehicles ever growing, it is essential that dealers maintain and grow their understanding of this market and have the right cars on their forecourts.”