Imperial Holdings chief executive Bill Lynch, who will be one of the prominent speakers at the upcoming CAR Conference, says that the Competition Commission’s investigation into vehicle pricing could have a positive influence on his group’s business.
Imperial Holdings chief executive Bill Lynch, who will be one of the prominent speakers at the upcoming CAR Conference, says that the Competition Commission’s investigation into vehicle pricing could have a positive influence on his group’s business.
Lynch said automotive manufacturers had a powerful influence over dealers in aspects such as investment and standards, and ” any loosening up of that relationship would not be to our disadvantage”.
CARtoday.com reported on Wednesday that role players in the motor industry and consumers alike were eagerly awaiting the results of a vehicle affordability probe led by analyst Roger Pitot, expected to be made public shortly before Auto Africa, during which the CAR Conference will be taking place.
The Competition Commission’s findings on alleged price collusion in the motor vehicle industry, excessive pricing and imposition of minimum resale prices on dealers, are also imminent. Given those facts, the upcoming CAR Conference at Auto Africa is sure to be of hotbed of debate over vehicle affordability.
Announcing its annual results yesterday, Imperial said it had raised revenues to R35,3 billion in the year to June. Revenue in the distribution division, which includes car importer Associated Motor Holdings, jumped 40 per cent to R6,3 billion. Profit before tax went up 172 per cent and margins increased 61 per cent.
By contrast, the vehicle dealership division reported a 10 per cent reduction in pretax profit and margins contracted by 18 per cent, despite an 11 per cent gain in revenue to R10 billion.
Commenting on the dealership division’s performance, Lynch hinted at the control car makers had, particularly over the margins Imperial’s dealerships were able to make. The stronger rand also placed pressure on dealer margins, Lynch was quoted as saying.
He said Imperial’s performance was satisfactory in a challenging year, given “the strength of the rand, low levels of economic growth and low inflation”.
According to Lynch also announced that the group would establish a new wholly-owned financial institution that would house most of the group’s revenue-earning mobile assets, including 40 000 vehicles, worth about R7,5 billion.
The upcoming CAR Conference – themed “affordability, mobility and growth” and held in association with Nedbank Vehicle Finance – takes place during Auto Africa at the Expo Centre (NASREC) in Johannesburg on October 27. For more about the conference’s programme, speakers and booking details, click here.
