LONDON -- British car dealer Inchcape and smaller rival Lookers said on Thursday the UK car market was softening, in the latest sign of unease on the high street.
"There are less people in the showrooms and on the forecourts," said Peter Johnson, chief executive of Inchcape, which distributes and sells cars for Toyota, BMW, Ferrari and Volkswagen among others. "Fleet and business sales are holding solid, but there's a slight softening in retail," he told Reuters ahead of the group's annual general meeting.
"It's an awful lot to do with confidence, to do with what's been said about the housing market and I think there's an expectation that interest rates might rise,"he said, adding that overall the international business was upbeat.
Lookers, which made a timely exit from its relationship with collapsed British carmaker MG Rover last June, said the UK market was softening.
But the 97-year-old firm, which also holds its annual general meeting on Thursday, said it had bought a used car dealer and was gaining market share.
"The market this year to end-April is down 6.6 percent. Our numbers are a hell of a lot better than that. We're down about 1.5 percent in the year to date," Finance Director David Dyson told Reuters.
BENTLEYS SOLD OUT
Analyst Mike Allen at Numis Securities said Lookers' acquisition of used car dealer Ian Shipton Cars for 12 million pounds would help protect the group from the cyclicality of the new car market.
Inchcape said performance was ahead of expectations in Australia and Singapore and in line with expectations in Hong Kong. Market share has been lower than anticipated this year in Greece and Belgium, it added.
"In Australia, it's a record market and a record market for Subaru," said Inchcape's Johnson. "People said for the last three years that it couldn't keep rising, but it has."
Johnson said UK sales of prestige cars had been hit no harder than any other marques.
"As availability improves on the BMW 3 series, I've no doubt that franchise will be coming right back," he said. "Mercedes is doing fine. Jaguar with the X-type diesel -- that's the product we've needed. Land Rover and Lexus are doing well."
Dyson said availability problems had hit Lookers sales of the new Range Rover Sport. "It's going to be delayed but we've got orders coming out of our ears," he said.
"The remainder of this year, in particular, will benefit from the launch of the Bentley Continental Flying Spur, the Aston Martin V8 Vantage, the Range Rover Sport and the new Lexus GS," Lookers said in a statement.
"We have, in fact, sold out our entire allocation of these models for the foreseeable future," it added.