The average UK motor retailer made a profit of £200 in the month of August, a marked contrast to the traditional result for the month, which last year produced an average loss of just under £17,000.
This was all produced by pre-WLTP deadline activity, with significant incentives being provided to move cars prior to the start of September, according to dealer profitability specialist ASE.
“As a result of the August activity and the dearth of product in September I am expecting a significant profitability fall in the month.
“New car sales will be hit as a result of the lower volumes and I am also expecting a fall in aftersales revenues as a result of the lower number of working days allied to reduced volumes of new vehicles, particularly fleet sales, requiring PDIs,” he said.
Jones said the used car market continued to be highly profitable for dealers across the board.
“Whilst the new car market has been relatively choppy, used cars have remained very lucrative. Margins and values are benefiting from the reduced volumes of new vehicle sales.
“Retailers who undertook significant self-registration exercises at the end of August clearly have a job to do, however this should not derail the overall positive story around used car performance.
My prediction is that, despite the forecasts of some brands, we will not fully catch up in 2018 and retailers will see overall annual profitability fall, to be followed by a catch-up in March 2019.