Prime Minister Boris Johnson struck another blow to the UK motor retail sector last night, ignoring concerted lobbying from the industry and again lumping it in with other ‘non-essential’ retailing such as hair and nail salons, saying they must remain shut until at least 12 April. This despite the fact dealerships can be made far more Covid-secure thanks to the large areas of space available.
In the lead up to his ‘roadmap’ announcement last night, Mr Johnson was reportedly lobbied by car industry leaders to open up dealerships two weeks ahead of other non-essential retailers. Last night he showed – as he has throughout the pandemic – that he does not understand the special nature of the retail motor sector, not only in terms of dealerships being safe environments but also its capacity for generating much-needed VAT income for the government.
But, instead of opening for the key plate change month of March, industry experts are saying that they will have to move March activity into April.
NTK Motors’ training partner, Simon Bowkett, spoke for many dealership and manufacturer clients when he commented after Mr Johnson had spoken: “April is surely going to have to be the new March. There are a lot of people who want to touch and test drive a car before purchasing, they represent the pent-up demand to buy a car. People whose PCPs and MOTs are coming due in March will still want to change their vehicles.
“The entire sector will be frustrated that going into a garden centre or supermarket is considered a safer retail arena than a dealership – when we have so much space to stay safe in. The Government has never listened to that argument.”
With around 20% of new car sales, around half a million vehicles, coming in a normal March it is now felt that missing that crucial month will add further pressure on already suffering dealerships. Some industry experts are saying that, following the disappointment of the Prime Minister’s speech, around half the usual March sales could be lost. This could equate to over £5 billion in lost sales.
Throughout the lockdowns, many dealerships have relied on used car sales remaining relatively unscathed. But equally they had pinned their hopes on being open for the crucial plate change period. Johnson’s ignoring of the sector will be seen by many as a terrible blow.
One more point. Keeping dealerships closed until at least 12 April means car buyers will have to choose via click and collect or go elsewhere, such as into the arms of the burgeoning online only sellers.