Profitability within the dealership side of the motortrade industry continued to grow in to the month of April. This is a year on year improvement of 36.4% on average.
Mike Jones, chairman of ASE said this should be considered “creditable performance” considering the impact of the Easter bank holiday and a sales dip that tends to follow the Change of plate in March.
There is an average return of 1.55% on sales. This is up from 1.29%.
“The net profit return on sales percentage dropped slightly from the highpoint of March as a result of the volume of business transacted, however dealers are still adding to their bottom line result and building their service parc for the future,” Mike Jones said.
The strong sales results are primarily through the buying of new cars with an average of 48 new cars and 41 used cars being additionally being sold compared to the same time last year.
“The overhead absorption ratio has continued its slow and steady improvement, albeit still at a historically low figure. This is very pleasing to see with a steady reduction in idle time and increased labour efficiency. Whilst there remains significant spare capacity this is slowly being eroded driving aftersales profitability,” he said.