Lookers credits higher sales to Britons’ enhanced fears of public

Car dealership Lookers has credited Britons’ growing aversion to public transport for helping their sales recover after being forced to close their sites for two months.

The company revealed it sold more than 42,000 vehicles between July and the end of September, a 13.6 per cent like-for-like rise on the same period last year.

Both new and used cars experienced substantial increases in sales, and the group said its performance last month went ‘particularly well’ even as new car registrations across the UK remained depressed.

Lookers says sales have grown due to Britons' greater reluctance to travel on public transport

Lookers says sales have grown due to Britons' greater reluctance to travel on public transport

Lookers says sales have grown due to Britons’ greater reluctance to travel on public transport

New unit sales shot up by 27.1 per cent on 2019 levels as the reopening of stores and customer qualms about travelling on trains and buses released pent-up demand.

Meanwhile, trade in used vehicles increased by a more modest 6.2 per cent and it anticipates its third-quarter results to show underlying pre-tax profits being ‘significantly ahead’ of last year.

Chief executive Mark Raban commented: ‘Our decisive self-help measures, combined with better than expected trading in Q3 and strong support from our brand partners, have helped the Group emerge from lockdown in a strong position.

However, the temporary shutting of their dealerships at the pandemic’s outset is expected to cause Lookers a first-half loss.

In addition, it declared its hopes of publishing its 2019 financial results in November. Release of the figures has been delayed by a fraud probe initiated in March just as the car retail market was entering a downturn.

The investigation has already uncovered a £19million black hole in the automotive seller’s accounts and led to the resignation of chief operating officer Cameron Wade.

Lookers' fraud probe has already uncovered a £19million black hole in its financial accounts

Lookers' fraud probe has already uncovered a £19million black hole in its financial accounts

Lookers’ fraud probe has already uncovered a £19million black hole in its financial accounts

August saw the investigation’s scope widened to cover its corporate leasing division and vehicle funding arrangements as well as previous years’ balance sheets.

Raban stated that the group remains ‘cautious around the future outlook given the ongoing Covid-19 backdrop, but we are well-positioned to deal with any emerging challenges.’

As part of plans to save £50million, the Altrincham-based firm announced the axing of 1,500 jobs and closure of 12 sites in June. It also took advantage of the government’s furlough scheme to pay a majority of its staff.

Other motor dealer companies such as Pendragon and Marshall Motor Holdings have furloughed workers, while Inchcape has borrowed £100million from the Bank of England’s Covid Corporate Financing Facility.

There were 328,041 car registrations last month, the lowest for September in 21 years

There were 328,041 car registrations last month, the lowest for September in 21 years

There were 328,041 car registrations last month, the lowest for September in 21 years 

All have experienced dramatically subdued demand this year, and despite a revival instigated by the relaxation of lockdown restrictions, sales are still considerably lower.

Trade body The Society of Motor Manufacturers and Traders (SMMT) revealed in its latest monthly vehicle data that 328,041 new cars were registered last month, the worst September since the dual number plate system was introduced 21 years ago.

Over the first nine months of 2020, the total number of new car registrations plunged by a third. Diesel vehicles have taken a substantial fall as buyers seek out greener models.

Mike Hawes, SMMT’s chief executive, noted that despite the ‘incredible resilience’ demonstrated by the automotive sector, the figures did not show signs of a recovery.

He added: ‘Unless the pandemic is controlled and economy-wide consumer and business confidence rebuilt, the short-term future looks very challenging indeed.’

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