Car dealership chain Pendragon has revealed that it intends to focus on its used car sales empire to boost growth in the future.
The changes came off the back of a revelation that used car sales revenues were up by 9.5 per cent year-on-year. This compared with just a 3.1 per cent rise in sales of new cars over the same period. Pendragon says that the revenues it makes from used cars have increased by 64 per cent in five years, as its initiatives such as the Sell Your Car and Move Me Closer schemes have proven successful.
“Investment in additional physical capacity for used vehicle sales continues so that we can achieve at least double-digit growth in used vehicle revenue in 2017,” explained the firm in its annual results release for the 2016 calendar year.
It continued: “Our strategy is focused on our four pillars of choice, value, customer service and convenience, supported by our people and protected by ownership of our evolving intellectual property and IT.”
Pendragon, which is perhaps best known for the Stratstone and Evans Halshaw dealership brands, has announced that it has opened a brand new Car Store site in Gloucester as part of the used car focus. The firm has already opened some ten Car Store dealerships in the UK and plans to launch several more.
Overall, the firm reported a mixed bag of results for last year, with profits down 7.6 per cent to £73 million. Despite this, the firm’s chief executive, Trevor Finn focused on the fact that underlying operating profits were actually up by 0.7 per cent over the period.
Dealerships looking to change their focus towards used cars or new cars, in reaction to market trends, will need to keep their motor trade insurance policies updated to include any new stock. This will ensure they are protected from the costs involved if cars are damaged by fire, flood, accidents or vandalism – or indeed, if they are stolen from business premises.
Trevor Finn gave more details of its used car focus in a statement, explaining: "…during the final quarter of 2016 we invested in inventory and adjusted our algorithms and marketing initiatives with a view to driving growth in used vehicle activity levels to test the capacity of our current footprint.
"The early results of this are very encouraging. Our growth in used vehicle revenue on a like-for-like basis in January 2017 exceeded the increase required to achieve our growth aspirations."