Motor industry bosses have expressed their ‘deep disappointment’ at Boris Johnson’s roadmap out of lockdown after it was revealed that car showrooms will be forced to keep their doors locked until at least mid-April – meaning customers won’t be able to browse dealerships during the busiest month of the year.
March is traditionally one of the two most lucrative months for car sales due to the arrival of a new registration number, sparking greater demand for new models than any other time of the year.
However, the Prime Minister’s plans – announced on Monday – for non-essential retail venues to not welcome customers back until April 12 means the motor sector is set to lose out during a key selling month.
Closed in March: Car dealerships will not be allowed to open their showrooms to customers until 12 April. That means they’ll remain shut during the busiest month of the year
Going back to 2019 – before the coronavirus pandemic took hold of the economy – around 20 per cent of all new car registrations were in March.
Some 458,000 new motors were purchased in the third month that year out of the 2.3million total sales recorded in 2019.
Unable to hide his frustration about the decision to keep dealers locked down, Mike Hawes, chief executive of the Society of Motor Manufacturers and Traders, said the industry understands that the priority ‘must be to get the virus under control’.
But he added: ‘Nevertheless, the fact that retail showrooms must remain closed until April at least is deeply disappointing given these facilities are Covid-secure, large premises with low footfall and able to operate on an appointment-only basis.’
The motor industry, like so many other sectors, has had to think of ways to diversify how it operates in order to deliver a service to consumers during the coronavirus restrictions – measures that are helping them to keep their head above water until ministers give the green light for them to reopen.
The biggest of these is ‘click and collect’ services, which were launched by dealerships during the final phase of the first lockdown and made available ever since.
Based on 2019 sales record, one in five new cars bought that year were purchased in March as drivers flock to showrooms to get their hands on motors with the latest number plate
Sector bosses said dealerships are among the venues with the best social-distancing protocols that retailers had spent vast sums on implementing from 1 June 2020
Sue Robinson, chief executive of the National Franchised Dealers Association said she had written to the Government to make it aware of the safety procedures dealerships are able to follow, and of how important it is for the sector to reopen as soon as possible
This allows customers to purchase a vehicle online, then collect it from outside a dealership’s showroom under strict social-distancing protocol.
‘Whilst click and collect can continue, this does not replace the showroom experience on which so many retail customers depend, especially in the all-important March plate change month that represents one in five of annual new car registrations,’ Hawes added in a statement made following the Prime Minister’s announcement.
‘Unfortunately, the continuing decline in retail business will translate into reduced production volumes as well as giving rise to other operational issues.
‘We look to Government to work with the sector to provide ongoing support and clarity so the industry can plan its reopening and recovery.’
The UK’s automotive industry has suffered its worst year for sales in 2020 for 28 years with just 1.63million vehicle registrations in total and as described by Hawes as a ‘lost year for automotive’.
And 2021 hasn’t started much strong. Registrations were the lowest in January since 1970, with demand for new cars down by 40 per cent last month compared to a year ago.
Car retailers have been forced to keep their doors locked to customers in recent months, instead providing ‘click and collect’ services to buyers
Sales of new cars hit a 28-year low in 2020, which has been described by industry bosses as a ‘lost year for automotive’
Industry figures show that 2021 has started slowly for the sector, with sales of new cars slipping to the lowest level in the first month of the year since 1970
Also commenting on Boris Johnson’s roadmap out of lockdown, Sue Robinson, chief executive of the National Franchised Dealers Association, said it had written to the Government to make it aware of the safety procedures dealerships are able to follow, and of how important it is for the sector to reopen as soon as possible.
‘There are more than 4,500 franchised dealerships in the UK, with over 590,000 people employed in the retail side of the automotive industry,’ she said.
‘Since the outbreak of the virus a year ago, the motor industry was one of the first to work with the Government to develop guidelines to enable a safe return to work. Dealerships have invested heavily to adopt best-practice measures and ensure maximum protection for staff and customers.
‘Dealerships have large areas, they generally have a lot of outdoor space on the forecourt and today there are very few vehicles in showrooms as these spaces are already adapted to be Covid-secure; social distancing is easy to maintain.
‘Dealerships can operate effectively by appointment and take all necessary steps such as measuring customers’ temperature when they enter the premises, wearing masks, working behind protective screens, as well as sanitising cars and keys.’
She added: ‘Dealerships could reopen safely and immediately’.
With showrooms shut in March, sector bosses will now be hopeful that Boris Johnson’s ambitions for normality to return around June 21 will generate increased demand for new cars in the summer.
The industry will be looking to September in particular, which is the second most profitable month for dealers with the arrival of the second annual plate change.
In 2019, some 353,250 new cars were bought in the ninth month, accounting for around 15 per cent of sales.
SAVE MONEY ON MOTORING
Some links in this article may be affiliate links. If you click on them we may earn a small commission. That helps us fund This Is Money, and keep it free to use. We do not write articles to promote products. We do not allow any commercial relationship to affect our editorial independence.