The average UK motor retailer saw profit in the March plate-change decline 6.7% to £107,000 compared to £114,700 in March 2017.
This brought the overall result for Q1 in 7.5% below the record recorded during the first three months of 2017, according to figures from dealer profitability specialist ASE.
ASE said while the decline was “significant “ it fell short of the 12.4% drop in new car registrations for Q1.
The used car market was strong in March with good margins and stockturn and so far there is no sign of the market overheating.
“There is no sign yet of deterioration in the market, however we have noted an increase in stock holding at the end of March.
“The profitable disposal of these vehicles will be vital as we progress through Q2 and into the remainder of the year,” said ASE chairman Mike Jones.
Dealers saw a “significant drop” in overhead absorption during March, which it said was down to a decrease in aftersales contribution for the month.
“This looks stem back to the poor weather at the start of March, with many businesses not recovering the lost hours in the workshop and barely matching their performance from 2017 when in previous months we have seen growth.
“It looks like we will finally have some good news on the registration front in April, with an increase of over 10% and good growth in private retail registrations. Whilst there was, as always, a rush at the month-end, registrations were ahead of the prior year for the majority of the month indicating that the improvement was not just a result of a raft of self-registrations.
“As we move through the following months we are starting to see the WLTP regulations have an impact on vehicle supplies. Whilst this may not change the overall number for the year, it could lead some registrations being pulled before the deadline and some postponed,” said Jones.