Pendragon expects current vehicle shortfalls to spill into 2023, as its profit slumped by 41 per cent.
In the three months ended 30 September, the UK dealer’s underlying profit before tax was £14.7m – down on last year’s £25.1m – due to the impact of inflation and rising interest rates.
Used car volumes were slumping as a result of new car production levels being down and their consequent impact on the availability of used vehicles.
Gross profit per unit, while still robust at £1,561, was lower than 2021 levels.
Nevertheless, strong performance in the new car market offset the decline in used vehicles.
Pendragon outperformed the market, as new units increased 14.2 per cent with profit per unit up by 41 per cent to £2,597.
The new car order bank also remained well above historic normal level at more than 20,000 at the end of September.
“Our agile and diversified business model positions the business well to respond to the uncertain environment, as demonstrated by the outperformance in new vehicles and the strong margin profile of the broader UK motor division,” said chief executive Bill Berman.
“While supply chain challenges and other market pressures are set to persist, we are confident we have the right strategy in place to deliver for our customers and partners, and to meet our expectations for the full year.”
Pendragon has in fact announced that its annual underlying profit will remain in line with expectations.
The dealership recently made the headlines when its suitor and majority stakeholder Hedin said it could consider withdrawing its £400m bid if approached by an offer of 35p per share or above.
Hedin made a move at the end of September approaching the UK car dealer with a 29p per share offer.
Just yesterday, Pendragon extended the deadline by which Hedin is required to announce its firm intention to buy to 21 November.