News

This is the second in our series designed to help motor dealers to understand the Financial Conduct Authority’s (FCA) motor finance review findings, which will not only shape the future landscape for dealer finance, but also and very importantly may require dealers to make changes to the way they work now.

By the end of 2019, the FCA will be extending the Senior Managers & Certification Regime (SM&CR) to almost all regulated firms, including motor dealers. In a nutshell, SM&CR embodies the principles of good conduct and promotes a culture where ‘doing the right thing’ for customers is at its very heart. So, are you ready for SM&CR and the additional responsibility it will place on you?

Your latest issue of Drive Magazine is here! This month, CEO Mark Standish discusses our changing industry and the importance of collaboration between dealers and lenders. We also have features on emerging trends in 2019 and an interview with bike dealer, Thunder Road...

At this time of year, dealers will no doubt have their eye on the used car market as part-exchange vehicles flood the forecourts and auctions. With the franchised sector chasing a declining new car market, the competition to boost used car business will be intense. However, there’s one element of the car-buying sector which is often overlooked. If tackled with the right offer and an insight into their needs and concerns, it could reap awards for both new and used car sales operators.

The September plate-change marks one of the year’s twin peaks for the new car market, when typically over 420,000 vehicles are registered. That’s almost double the volume of most months except for March, which remains the biggest and recently hit a record high of over 562,000 in 2017. 

In the first of this series, we talked about becoming a ‘destination retailer’ by providing a fantastic service-led ethos that customers can believe - now we're going to look at your online persona. Rather than take on the major manufacturer and retailer brands, independent dealers can compete in terms of personality and service, especially online. Yet all too often the first visit to a dealer, which will invariably for most customers will be online, can fall short in terms of; passion, authenticity and evidence. This is a big miss – to address this, it is time to start thinking about your online persona.

Jargon and acronyms are rife in the automotive sector so it’s not surprising we end up talking our lingo to consumers who are unlikely to have a clue what we’re on about. It can be even worse when it comes to vehicle finance with consumers expected to fathom out a barrage of information.

Used car sales saw a solid performance in the UK in Q1 of 2019, with sales down by just -0.6% year on year, highlighting the stability of the industry with more than 2 million transactions. We’ve seen a 30% growth in demand for hybrid, plug-in hybrid and pure electric cars and we remain confident that the industry will continue to grow.

Change in dealer F&I lies ahead with the Financial Conduct Authority currently consulting with the industry following its review of motor finance. Ahead of this change, we’ve considered the key areas that may change and what they may mean for dealers – first up is commission structures.

In an increasingly digital car retailing environment, dealers could benefit from a ‘destination’ ethos.  The starting point is where the customer invariably starts their car buying journey and that is online.

In their recent report on motor finance, the FCA made clear that they would be consulting with the industry on long term changes to the market - and that further scrutiny should expected. The report was also clear on the FCA’s expectation that action should be taken now to improve compliance with current requirements and ensure fair treatment of customers.

The trends noted last year, including the sizeable 30% reduction in diesel car sales and robust 21% rise in demand for alternative-fuelled vehicles (AFVs), are set to continue and maybe intensify. Read about how this might affect you and your dealership.