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Over the Christmas period, Motor Trader’s website, TalkingMotors.com, reported on the top breaking stories. Here is a round-up of the coverage
On the dealer front, shares in Lookers fell by almost 15 per cent to 19p, after the dealer group announced a profit warning and scrapped its final dividend.
Following poor sales in both the new and used car markets Lookers said it now expects its full year profits for 2008 to be less than half of last year’s level, at around £10m, below expectations of between £15.6m-£18m. Last year the group recorded a profit of £24.5m.
Car retailers had suffered from a slump in sales and the reduction in availability of consumer finance.
The group did however point out that used car sales were increasing in volume and margin, and that its aftermarket business was doing well.
UK car production suffered some more in December. Up to 800 jobs at Toyota were reported to be at risk in the UK as a result of the decline in the international new car market.
A report in The Times suggested the jobs, 15 per cent of Toyota’s UK workforce, could be at risk as a result of its forecast that the carmaker would post its first loss since 1941.
The possible losses could push total car manufacturing job losses up to 40,000 in the next three years, according to the report.
At Jaguar Land Rover the situation was also grim. The government privately assured the new owners of the struggling carmaker Jaguar Land Rover of delivering a bailout worth millions of pounds.
Tata, the Indian owner of the firm, had reportedly agreed to inject “tens of millions” of pounds into the business to prevent an immediate cash flow crisis, with the understanding the government will make an announcement on state aid soon, according to The Times.
Gordon Brown is said to have taken the decision to prevent the collapse of the carmaker and is due to announce a short-term bailout package including £600m in loans.
The downturn also had an impact on used cars. Analysis by EurotaxGlass’s showed volumes of nearly-new vehicles being offered for sale at the end of 2008 were a third (35 per cent) lower than a year ago, when, it said, supply far exceeded demand.
“In late 2007 the supply of 57-plated cars significantly outweighed market demand,” said EurotaxGlass’s managing editor Adrian Rushmore.
“This year, by contrast, the number of 58-plated vehicles appears to be more manageable. Many dealers still have on their books a significant number of cars at or just over three months’ old, but in general they are not overstocked – at least, not to the extent that they were 12 months ago.”
The component sector also took a hammering. Wagon Automotive said it was laying off 292 workers after the UK arm of the car parts business went into administration.
The jobs will go as the company’s Walsall manufacturing plant closes after administrators Zolfo Cooper failed to sell the business.
The Birmingham-based car parts firm employs 500 workers in the West Midlands and supplies components to Ford, General Motors, Honda and Nissan.