The 12 stories of Christmas
2021 was a tumultuous year for motor finance, with a range of factors impacting on the market. Editor Chris Lemmon monitors the stories that attracted the most traffic on the Motor Finance website in the last 12 months.
1. Coronavirus automotive timeline
Our rolling coverage of the Covid-19 pandemic and its impact on the UK motor finance industry unsurprisingly topped the list for website hits over the course of the year. One story in particular that drew attention was the unveiling of a new Covid roadmap in February, where prime minister Boris Johnson outlined the steps out of lockdown, with motor dealers having to wait until 12 April to open their doors.
At the time, Mike Hawes, chief executive of the SMMT, acknowledged that while the priority must be to get the virus under control, the roadmap was disappointing given showroom facilities are large Covid-secure premises with low footfall.
2. UK used car market buoyant as supply issues affect dealers
In July, Motor Finance published research from Aston Barclay’s Market Insights report, which reported significant price increases in the second quarter of the year. Late and low mileage car prices increased 25% to £18,350, while ex-fleet cars jumped 16% to £12,109.
“In over three decades of working in the remarketing sector I’ve never seen used car prices rise so dramatically in a three-month period. Many dealers are desperately short of stock which is compromising their businesses, but there is no change on the horizon,” said Martin Potter, Aston Barclay’s managing director – customer.
3. The AA launches personal car leasing proposition
Back in January, the AA launched a personal car lease product in partnership with LeasePlan UK. Labelled Smart Lease, the service enables customers to see the total cost of driving a vehicle over the course of the agreement and includes fully comprehensive car insurance – provided the customer meets certain qualifying criteria.
James Fairclough, chief executive of AA Cars, said: “We know the pandemic has been a huge challenge for many of our customers, and a car is a big financial commitment in uncertain economic times. That is why we are enabling drivers to return their car without penalty in certain circumstances, such as redundancy, offering vital peace of mind when many are experiencing uncertainty about their employment and finances.”
4. MotoNovo chief Mark Standish steps down after 22 years
In August, MotoNovo Finance chief executive Mark Standish announced his decision to leave the business, having overseen the integration of MotoNovo within parent Aldermore Group.
Commenting on his decision to leave, Mark Standish reflected: “I am enormously proud of what MotoNovo has achieved and of the people who have been part of the journey. From serving 12,000 customers in 1999 to 530,000 in 2021. From a team of 65 to 780 today, leading MotoNovo has been an incredible privilege.”
5. Autumn Budget 2021: what it means for UK automotive
Chancellor of the Exchequer Rishi Sunak revealed the details of the 2021 Autumn Budget in October, outlining the government’s spending plans for the future.
The key takeaways for the automotive industry were a £6.1bn investment to reduce transport emissions – including £620m of new funding for public chargepoints and targeted zero emission vehicle grants. £800m was dedicated to investment in the production of EVs in the north-east and the Midlands, while the planned rise in Fuel Duty was cancelled.
6. cinch launches vehicle care subscription service
In March, online platform cinch launched a subscription service – cinchCare – offering consumer access to servicing, lifetime warranty and breakdown cover subscription for less than £35 per month.
Available to customers purchasing their vehicles via the cinch platform, cinchCare includes all annual servicing costs, covers all warrantied parts and labour costs, alongside premium roadside cover.
Speaking at the time, Craig Purvey, chief customer officer at BCA, said he believes the service “offers convenience and peace of mind for used car buyers who choose cinch, with an affordable monthly subscription fee covering all servicing and premium roadside cover”.
7. Aston Barclay enhances digital platform for finance house clients
In September, Aston Barclay launched a fully closed group ‘white label’ timed auction platform to help finance houses repatriate used cars back into franchised dealer networks.
“We have enhanced our digital products to facilitate our customers’ needs and have successfully repatriated thousands of cars since to the Mazda, Vauxhall and VAG franchises in partnership with our finance house customers,” said Martin Potter, managing director – customer at Aston Barclay.
“The biggest wins for our finance customers are the digitisation of their de-fleet processes and subsequent retail finance opportunities for their dealers on used cars that provide new retail opportunities that generate profit and revenue for both parties.”
8. Sam Watkins promoted to sales director at Cox Automotive Europe
Sam Watkins was promoted to the newly-created role of sales director at Cox Automotive Europe, assuming the position on 7 June 2021.
Watkins was working as commercial director for Manheim Vehicle Services, where she played a role in retaining and winning new contracts from vehicle manufacturers, finance and fleet operators, as well as opening several opportunities for Cox Automotive in other business areas.
In the new role, Watkins takes on responsibility for several areas of Cox Automotive Europe’s sales approach, bringing the firm’s sales functions closer together. Watkins now reports directly to James Leese, chief customer officer for Cox Automotive Europe.
9. Lockdown woes cause 10% fall in dealer confidence
In May, research from Close Brothers Motor Finance revealed a 10% decline in dealer confidence from a year previous, suggesting that the most recent lockdown had taken its toll on some motor dealers.
The survey found that 85% of car dealers were confident about the outlook of their business, falling from 95% in August 2020. Of those who said they were confident about their business in the short-term, over a quarter (29%) felt ‘completely confident’ and 57% feel ‘fairly confident’. This rises to almost a third (31%) feeling ‘completely confident’ when considering the longer term.
10. Cazoo rolls out car subscription service in the UK
In June, online car retailer Cazoo launched a car subscription service, offering customers a vehicle with a single monthly payment inclusive of insurance, maintenance, servicing and tax.
Each subscription includes fully comprehensive insurance cover, servicing, maintenance, road tax and 24/7 roadside assistance and comes with a 1,000 miles monthly allowance and a 7-day money back guarantee. The subscriber just needs to add fuel or charge the battery.
Alex Chesterman, founder and chief executive of Cazoo, said: “Subscriptions offer flexibility and convenience and it is clear from our research that a simple and comprehensive car subscription offering is long overdue.”
11. Demand for EVs spike as fuel supply crisis intensifies
Amidst a nationwide fuel supply crisis in September, demand for EVs spiked on platforms including Auto Trader, Leasing.com and heycar.
Auto Trader reported that searches for electric cars jumped by 60%, while heycar reported that leads on EVs sent to its dealer partners more than doubled during the week.
Despite the interest, Auto Trader’s Ian Plummer doubted whether it will represent a major step towards achieving the government’s ambitious targets – as EVs remain substantially more expensive than their petrol or diesel counterparts, and fears of an inadequate charging infrastructure remain.
12. Cox Automotive completed acquisition of Codeweavers
Back in March, Cox Automotive confirmed the acquisition of Codeweavers, a provider of commerce solutions and finance software for manufacturers, retailers and lenders.
Advancing the firms digital retail offering, the acquisition of Codeweavers formed part of Cox Automotive’s strategy to double the size of its operations by 2034 and stand as number one operator in the market.
Retaining its current brand, Codeweavers now sits alongside Cox Automotive’s existing digital marketing and retail solutions business – Modix.
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