Car dealers profits shrink to just £3,000 in April, ASE finds

Car dealers in the UK brought in an average profit of £3,000 in April 2015, according to the latest figures from performance specialist ASE.

Although still enjoying a profit, albeit it a small one, the performance of car dealers is down on last year's profit of £9,000. The latest drop means profits have now fallen for four consecutive months, leaving them settled around an average annual figure of just over £200,000, with each month in 2015 failing to live up to the comparative month in 2014.

As profit margins narrow, it is important that car dealers protect every penny they earn. Obtaining a high quality road risks insurance or motor trade insurance policy can do just that - by protecting the business' assets against theft, damage or accidents, it provides a valuable financial safety net to ensure a dealer is not left eating into their profits to make amends for unfortunate incidents.

According to Mike Jones, ASE chairman: “The cause of the drop remains a decline in the performance of the vehicle sales department and decreases in overhead absorption as a result of increased costs.”

The April 2014 statistics also produced further evidence of an increase in dealer self-registrations, AM Online reported. Whilst used vehicle sales increased 10 per cent on prior year volumes, new vehicle sales dropped by six per cent.