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Friday, November 30, 2007
the Auto Retail Informer November 30, 2007
Auto Retail Informer Intro November 30, 2007
During the year we highlighted the very competitive new car market and the deflationary effect on transaction prices of new cars. Whilst this has been positive on new car volumes, it has had a negative effect on used car margins as the deflationary effect on new car prices also feeds into used car prices. We have been successful in maintaining activity levels in used car sales although this has not compensated for the loss of margin. Used car margins have shown a positive trend over recent months but this recovery is too late to recoup lost profits from earlier this year. Additionally, we have experienced a drop in our California business due to US economic uncertainties and very recently serious bush fires in the southern California area. Cons
...To view the entire article: U.K. Auto Retail Market Struggling?
This week Pendragon, the largest franchised auto retail group in the United Kingdom, lowered its operating earnings expectations by 12 million pounds this year, and 18 million next year. The stock got crushed (down 30%.) Management cited a very competitive new vehicle market causing margin pressure with their used vehicles. They also have a number of dealerships in California, and cited a tough economic backdrop and the bush fires in Southern California. Group 1 has a handful of stores in the United Kingdom. But right now I don't think the roughly $180 million in revenues being generated from Group 1's U.K. platform (out of $6+ billion company-wide) are enough to cause serious swings to the company's overall annual earnings trends. <
... To view the entire article: |
1 - LAD