Chief executive of Lookers, Andy Bruce, the UK’s biggest dealership said, ‘‘Had Brexit gone the other way, we’d be looking at a record car market this year”.
Bruce hopes the market has bottomed out after the sales ended in April. “I don’t think there was anything to read into it other than Brexit. There is no systemic downturn. The [new car] market was 2.7 million at its peak, and I believe we’d be heading for 3 million had Brexit gone the other way”.
According to Bruce, the rise of personal contract purchase loans means Britons no longer treat buying a new car with the same reverence as other big purchases, such as a kitchen. He says, “Cars are not classed as big-ticket items because of PCP. People don’t really know the price of a new car anymore. Everything is communicated in how much down [in a deposit] and how much a month. It has become a bit of a mobile phone”.
Bruce said, “All the Mercedes we sell come in from outside, as do the Volkswagens and Renaults. It would be a real problem if we had to go through an onerous import process. You can imagine what Dover and various ports in northern Europe would look like. We can’t prepare for that; we just have to wait and see”. He also added, “The Brexit currency shock, which pushed up grocery prices, also inflated car prices and a no-deal Brexit is likely to spell yet higher prices and delays for consumers, who typically wait 12 weeks for a new car. You can imagine it would add a huge amount of complexity – and cost – to getting the cars to customers”.
“People used to drive round dealerships, do test drives and haggle over part-exchange, but all that happens online now. The average number of visits per sale is down from four or five to 1.5”, Bruce added.