The consultancy firm ASE has confirmed that the average UK dealer recorded a profit of £46,000 in June 2017, up on the previous year despite a fall in registration levels.
The June figure marks an increase of £3,700 over the profit made in June 2016. ASE data shows the current year to date remaining ahead 2016 year, on the back of strong Q1 sales. In 2017 April and May underperformed leading to Q2 being behind the prior year by £10,500.
Profitability in June was driven by vehicle sales rather than aftersales services.The consultancy highlights the fact that overall year to date return on sales remains above 1%, showing a marked decrease on the prior year as a result of the significant increase in average sales seen over the past 12 months.
ASE state return on used car Investment remains comparatively high, and stock levels are still high due to dealer self registration. They note no sign of a crash in used car residual values.
With regard to current trading, ASE notes a slow start to Q3, with registrations down 9% on the prior year, saying “Given the volume splits of the quarter we will only gain a true picture of performance once we have closed September, however I would expect profits to follow a similar pattern as in prior quarters with underperformance in the first two months preceding a bumper bonus to finish.”
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