Vertu Motors upbeat despite fall in used car sales in the first half of 2023

Vertu Motors upbeat despite fall in used car sales in the first half of 2023

  • The group revealed that like-for-like used vehicles down by 6.3% in first half

Vertu Motors remains ‘positive’ despite a fall in the volume of used vehicles sales in the first half of 2023. 

The car dealership revealed like-for-like used vehicles sales had fallen 6.3 per cent in the five months to 31 July, with the company putting this down to a ‘change in approach, along with a continued lack of supply of used vehicles’.

The Gateshead-based firm also revealed that trading profit was above prior year levels which they put down to the acquisition of Helston – a deal which was completed in December.

The car dealership business revealed that like-for-like used-vehicles volumes had fallen by 6.3 per cent in the first half of the year

The group also said ‘recent increased supply of new electric vehicles appears to be exceeding retail demand, creating an imbalance in pipeline inventory coming into the key plate change month of September’.

The firm revealed rising interest rates meant that it was unable to ‘run its popular 0 per cent finance offers on used vehicles’ as it was able to last year. 

Vertu Motors shares were down by 1.1 per cent to 68.2p in early trading.

Robert Forrester, chief executive officer of Vertu Motors, said: ‘Trading remains positive. 

‘The entire Vertu team has put in hard work and dedication once again, and I would like to thank them all. 

‘Used car pricing has remained firm and we have gained market share in the new car market. 

‘The performance of our high margin aftersales business has remained strong. The integration of Helston Garages remains on track to deliver the planned synergies. 

‘The Board remains optimistic for the future, we anticipate that full year results will be in line with current market expectations, and we are excited about the opportunities our enlarged portfolio will create for Vertu Motors.’

The business also mentioned that during the first half of the year it was able to increase ‘vehicle inventory levels to ensure future sales volumes are maximised’.

The car dealership said it has continued to buy back shares, repurchasing approximately 7.4million shares which represents 2 per cent of opening shares in issue, in the financial year to date, for a total cost of £4.8million. 

In May, research from second-hand sales platform Motorway showed that the value of some used SUVs and city cars has jumped by almost 30 per cent over the last two years thanks to a combination of high demand and low stock.

It also found that cars that can be used for trade, such as vans and private hire vehicles, are in high demand with dealers and can get great prices when sold in fair condition with relatively low miles throughout their lifespan.

But despite average used car prices continuing to rocket, the value of some models has plummeted by more than a quarter in the last twelve months.

The biggest price fallers were electric cars, as a combination of factors has dragged down EV valuations, including rising stock of used vehicles, increased supply of showroom-fresh cars and salary sacrifice tax break incentives to buy new.