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Dealer profitability specialist ASE has forecast that overall dealer profitability for 2017 is going to be slightly down on a year ago.
ASE chairman Mike Jones said with new car sales on the slide dealers needed to focus on used cars and aftersales to maintain momentum.
in the Winter edition of Driving Force he said the fall in new car sales came as no surprise with the decline in sterling and had been flagged up by the SMMT well in advance.
“We have always operated in a supply push market and when the brands stop pushing, unsurprisingly volumes fall.
“Given the current level of sterling this should not come as any surprise, however it will mean that retailers will need to increase focus on used cars and aftersales to bolster their overall performance.”
Jones said the current used car performance was “very healthy” and the high volumes of pre-registered cars had not dented the market
“I will be watching this closely, particularly on the back of Pendragon’s profit warning and the volume of nearly new cars they holding certain franchises, however the overall performance has been strong.
“Aftersales has also improved on the prior year, albeit there remains a significant amount of untapped work which we are currently letting leak into the independent sector,” he said.