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Car dealer losses average £11k in August
£11,000 is pretty hefty chunk of change – enough to buy you an entry-level MINI hatch, or a large amount of used first generation Porsche Cayenne.
We mention this just for a touch of perspective, because, on average, every car dealer site in the UK lost that amount of money in August this year.
Yes, that’s right – according to monthly profitability data produced by business management specialist ASE, the average UK dealer site was down £11,000 in August 2012.
This is actually an improvement over August 2011, however, when the average loss was £15,000.
August is always a bad month for the motor trade, according to ASE chairman Mike Jones. The combination of the bi-annual registration plate in September, which holds back both potential customers and often dealer sales departments, plus an increase in staff and customer holidays means there is usually less money made.
Fortunately, it’s not all doom and gloom, as year-to-date the ASE reckons the average dealer site is trading £25,000 up on 2011 overall.
Used car sales are doing particularly well, the ASE claims, with gross vehicle margins up 9% and returns approaching 100% at 98.2% – meaning dealers are making more money on the second-hand cars they sell in 2012 than they were in 2011, even though good quality used stock is apparently proving hard to find.
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