Top Three Motor Trade Stories from April
Three motor trade news stories you should read. From MOT changes to Motor Ombudsman growth.
Read a summary of three of the most important motor trade news stories from April. As changes to the MOT rules dominate the news amid advice for used car sellers, industry competition heats up as a 6% drop in used car enquiries and a 5% drop in used car sales in Q1 means traders having to compete for less enquiries.
Motorists Find New MOT Rules Confusing
According to a survey commissioned by Servicing Stop, only 30% of drivers understand the MOT rules which came into effect on the 20th April. Changes mean that fails and advisories have since been replaced with minor, major and dangerous faults. Despite the confusion, 81% of motorists think the new changes are a good idea.
Chief Executive Officer and founder of Servicing Stop, Oly Richmond, said: “The new changes are clearly being introduced in a bid to bury diesel vehicles once and for all. The new regulations which see the smoke limit test halved makes the test extremely difficult for a diesel car to pass.
“While the test changes are coming down hard on diesel drivers, it’s not making life easy for our mechanics either. A driver of a car with a tampered with DPF will now have to cough up evidence. This will no doubt create lengthy and unnecessary dialogues between busy mechanics and confused motorists over why and how they provide this evidence. What evidence is needed and why? What are our mechanics then going to do with this evidence?
“Aside from confusion over diesel particulate filters, motorists will generally be baffled about the new pyramid of faults. For years we have had advisory items and fails; this is currently an easily navigated system understood by all drivers.
“The new trio of minor, major and dangerous faults will not only take a while to comprehend for drivers, it’s also going to be a new challenge for mechanics trying to advise customers, especially on those dangerous faults which mean you simply can’t let that vehicle go back on the roads.
“While I think there may be hurdles along the way, hopefully the new changes can help cut emissions and make car servicing more transparent and effective at keeping dangerous vehicles off the roads.”
PCP Crucial For Independent Retailers
Offering PCP funding is crucial for independent retailers who want to grow their sales in 2018, that’s according to the Managing Director at ADESA Remarketing Jonathan Holland, who also said that the used car industry faces threats from contract hire and leasing companies.
“PCPs have become the norm in the new car market as buyers move away from the concept of needing to own their vehicles. They have proven to be particularly popular with millennials coming into the car market and looking at monthly budgeting, with a fixed price, rather than outright ownership. Dealers are now finding that used PCPs are resonating with these buyers.”
“The independent sector needs to prepare for the possible challenge posed by contract hire and leasing companies, who have easy access to vehicles, by making sure they have the best possible stocking lines in place and are able to offer customers competitive PCPs.”
In addition to his comments regarding PCP sales, Holland also discussed new ways dealers can source stock: “We are seeing a growing number of independents taking advantage of sourcing stock online, when it first becomes available, rather than waiting for physical auction sales. Stock sourcing is an incredibly competitive business and the most successful independents are buying online and upstream and retailing the vehicles immediately with used car PCPs.”
According to the Finance and Leasing Association, 1.36m used cars were purchased using point-of-sale dealer finance in 2017.
Offering PCP could be even more crucial with the expansion of Big Motoring World, Cartime, Motorpoint and Trade Centre UK increasing competition in the used car market.
Motor Trade Ombudsman Reports Increase In Sign Ups
If you have been thinking about signing up to The Motor Ombudsman (TMO) you wouldn’t be alone as the motoring organisation has reported a 107% year-on-year increase for Q1. The figure includes independent garages and used car outlets either signing up or renewing their TMO membership.
Chief Ombudsman and Managing Director of The Motor Ombudsman, Bill Fennel, said: “It’s been a very busy start to 2018 as our role in the automotive industry becomes ever more established and well-known amongst consumers and in the motor trade. Whilst franchised dealers account for the bulk of our Service and Repair and Vehicle Sales Code accreditations, we are now seeing even more independent sites recognising the value of Motor Ombudsman accreditation as a way of standing out from the crowd in what is a hard-fought sector.”
“Having a seal of approval from an organisation such as ours gives today’s motorists the reassurance that the garage will deliver exemplary standards, and that there is an impartial ADR provider to go to should something go wrong. This could make all the difference between winning custom and losing it to another business in the local area.”
The Motor Ombudsman was previously known as Motor Codes, but rebranded following the introduction of the Alternative Dispute Resolution regulations that came into force in October 2015.
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