Mazda Dealers in the UK Report Improving Profits

DARTFORD, KENT – July 29, 2009: Mazda dealers are fighting the recession with net profits improving by 60 per cent in the first five months of 2009 compared to last year.

Across the industry, year to date sales volumes are down 25.9 per cent according to the latest registration figures from the SMMT, but Mazda’s 157-strong dealer network reports that its turnover is down only 11 per cent while return on sales has improved from a margin of 0.8 per cent in 2008 to 1.5 per cent this year. This is above the industry average of 1.0% reported by ASE, the UK’s largest supplier of Professional and Business Management Services solely for the Motor Industry.

Mazda’s top performers continue to deliver outstanding results, with the best 25 per cent of dealers showing a return on sales of more than 3.7 per cent, up from their 2008 level of 3.5% and also ahead of the ASE benchmark of 3.0% return on sales.

Most dealers are reporting a net profit for the year-to-date and an improvement over the same period in 2008.

This remarkable position follows the rapid response instigated by Mazda UK to the recession including reducing the stock levels at dealerships and the move to banking giant Santander for wholesale funding. That decision alone has helped reduce interest costs on stock by more than 40 per cent making a significant contribution to dealer profitability, said Jeremy Thomson, Mazda UK Managing Director.

“The continued success of Mazda2 and the launch of the all-new Mazda3 has also helped boost profits for our dealers who are making the most of every opportunity including used car sales,” said Thomson. Dealers are reporting an operating profit for the first five months of the year up 24.1 per cent over the same period last year.

Aftersales and used car operations are also showing major improvements with operating profit up 6.2 per cent for aftersales versus 2008 levels and the used car business averaging a year-on-year improvement of 12.3 per cent.

With figures like these in a downturn, it’s no wonder that more and more companies are turning to Mazda as the franchise of choice. “We still have a few open points and we’re finding a huge level of interest from entrepreneurial companies wanting to become part of the Mazda network,” said Thomson.