Motorpoint scores record revenue for the second consecutive year
Motorpoint posts record sales for the second consecutive year as used car prices continue to rise
- Motorpoint said revenue grew 9% to £1.44bn for the 12 months ended March
- The company warned that annual pre-tax earnings would be “broadly break-even.”
- Prices of second-hand electric vehicles have fallen significantly over the past year
Motorpoint Group achieved record sales in 2022 for the second year in a row, thanks to a continued increase in vehicle prices.
The Nottingham-based car dealer revealed sales grew 9 per cent to £1.44 billion for the 12 months ended March, after rising by just over £600 million last year.
But the group warned that pre-tax earnings for 2023 were expected to “roughly break even,” after noting in January that falling electric vehicle prices and rising borrowing costs were impacting margins.
Turnover: Motorpoint Group revealed turnover has grown by 9 per cent to £1.44 billion for the 12 months ended March, following an increase of just over £600 million last year
The cost of buying used EVs has fallen significantly over the past year due to an imbalance between supply and demand, driven in part by the arrival of cheaper Chinese-made models and decreasing parts shortages in the auto sector.
Recent figures from valuation expert Cap HPI showed that the 20 biggest year-on-year average used car price drops last month were all EVs, with Tesla Model S prices falling 30 percent to £43,875.
For much of the coronavirus pandemic, used vehicle prices skyrocketed as new car production was hit by a lack of semiconductors as purchases of goods such as computers, cell phones and televisions increased.
This coincided with the release of pent-up demand in the UK as lockdown restrictions eased and unleashed a buildup of excess savings among Britons.
Sales growth has slowed as the cost-of-living crisis forces many consumers to scale back on expensive products.
But Motorpoint said it was making ‘strong progress’ in reaching its medium-term targets of more than £1bn online sales and total sales of more than £2bn this year.
Mark Carpenter, CEO of the company, said new car registrations rose 18 percent in March, supported by growth in the fleet market for the eighth consecutive month.
Not only will this increase used car offerings, he added, but “combined with continued market share gains and progress on our key initiatives, Motorpoint will be able to emerge from the current environment as a highly profitable market leader.”
Motorpoint was founded 25 years ago and has 19 offices across the UK. Last autumn it opened new branches in Edinburgh and Coventry, and is set to open its 20th branch in Ipswich in May, followed by one in Milton Keynes.
Darren Shirley and Clive Black, analysts at broker Shore Capital, said: “Investments in the well-skilled and thoughtful strategy continue unabated despite the cost-cash challenges facing some peers.
“Motorpoint should be a significantly larger, more profitable, highly cash-generating group going forward.”
Motorpoint Group Shares were up 2.7 percent on Thursday morning at 134.5 pence, though they’ve shrunk by more than half over the past year.