Major car dealership group with more than 100 UK sites ‘threatens job losses' as firm blames Reeves' tax raids

Scottish Sun

26-07-2025

Group 1 shut down two Mercedes-Benz dealerships this quarter
CUT OUT Major car dealership group with more than 100 UK sites 'threatens job losses' as firm blames Reeves' tax raids
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A MAJOR car dealer giant with over 100 UK sites is planning job cuts despite reporting hefty profits.
Group 1 Automotive will 'streamline' operations by cutting costs and axing duplicate roles.
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Group 1 Automotive UK has been restructuring its business since August last year
Credit: Alamy
The dealership doubled its gross profit in the first half of 2025, with sales soaring 94% - boosted by a stronger sales mix and improved aftersales operations, according to Car Dealer Magazine.
New car sales shot up 90% to 32,960 units, while used vehicle sales rose 89.5% to 41,580 units.
Group 1's revenues skyrocketed from £1.18bn to £2.3bn in the first half of the year - with gross profit jumping 109.6% to a whopping £313m.
The company also reported its UK gross margin improved from 12.6% to 13.6%.
This performance comes amid Group 1's ongoing restructuring efforts since August last year, which included integrating Inchcape UK's dealerships after a £346m deal last year.
The shake-up is expected to put 370 jobs at risk as of the end of June this year, though exact numbers have yet to be confirmed.
A spokesperson for Group 1 said: "In line with other retailers, we continue to face cost headwinds relating to tax increases announced in the last Budget, and in response we have identified opportunities to remove duplication, streamline processes and decentralise certain roles to drive efficiencies across the business."
In the second quarter, Group 1 shut down two Mercedes-Benz dealerships as part of efforts to improve its UK portfolio.
The group took a $7.6m (£6.1m) hit tied to layoffs and dealership closures, and has spent $18.7 million (£14m) so far this year on restructuring its UK operations.
Daryl Kenningham, Group 1 president and CEO, said: 'The U.K. market continues to be challenging in terms of industry volumes and with BEV mandate-related margin pressures.'
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He added: 'Integration efforts are largely complete and most U.K. brands are performing to expectations, with positive momentum anticipated in the second half of the year.
"SG&A leverage improvement remains a focus in the U.K., with room for further gains.
"We'll continue to pursue balanced growth while executing opportunistic share repurchases.
"Additionally, we're actively reviewing underperforming stores and developing appropriate plans."
US giant Group 1 Automotive runs one of the biggest car dealer networks in the UK.
The UK division operates over 115 dealerships and employs more than 7,000 staff.
The group represents over 21 brands, including Audi, BMW, Citroën, Ford, Mercedes-Benz and Porsche.
It comes as Group 1 recently announced the closure of its Volkswagen Telford dealership - just months after shutting down three other sites.