Vertu Motors cuts jobs and Sunday opening after budget and electric car target hits
The country's third largest car retailer says it is cutting jobs and closing its dealerships on a Sunday as part of efforts to cut costs amid tough trading and looming budget tax hikes.
Vertu Motors, which has almost 200 sites operating predominantly under the Bristol Street Motors, Vertu and Macklin Motors brands, made the announcement while revealing an unscheduled profit warning.
The company said its bottom line had taken a big hit amid steep discounting industry wide in a bid to meet a government target for sales of new electric vehicles - the so-called ZEV mandate.
Vertu, which employs 8000 staff, also pointed to a £10m rise in costs from budget tax rises due to take effect in April.
The ZEV mandate is the main gripe for the new car industry.
It demands a rising proportion of total sales come from zero-emission vehicles each year. It was 22% in 2024 and rises to 28% this year.
There are currently stiff penalties for missing that target.
2:35
It was missed last year amid the tough economy and industry pressure has forced a review.
The government has been looking at what help it can give to aid the transition since Vauxhall's owner moved to cut costs by announcing plans to close its Luton plant in April.
Vertu warned on Thursday that because price cuts to attract sceptical electric buyers were likely to continue this year, it expected further pressure on margins and for sales volumes to remain depressed given the continuing squeeze on household budgets.
0:56
The exact numbers of jobs affected by the company's spending cuts was unclear.
It is understood that while a small number of roles have already been axed, Vertu would not seek to fill jobs vacated through natural churn in the months ahead.
Vertu said it expected £4m in one-off costs to aid its long-term savings.
Those costs also included a move to bring all its brands under the Vertu name.
The company said in its statement that adjusted profit before tax for the year ending 28 February 2025 would be "significantly below current market expectations".
That consensus figure stood at £34.5m in December.
Shares fell by more than 7%.
Robert Forrester, Vertu's chief executive, told investors: "The Group's high margin aftersales business is performing strongly.
"However, the Government's ZEV Mandate is causing severe disruption to the UK new car market, and the consumer environment is subdued."
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
South Wales Guardian
3 days ago
- South Wales Guardian
EDF to buy Pod Point for £10.6m amid ‘slow' electric car adoption
The energy giant said a takeover was the 'only realistic prospect' of allowing Pod Point to keep operating as a business for the future. EDF was already a majority shareholder and the deal means it will take over the rest of the group. Pod Point, which has a network of more than 250,000 charging points in the UK, said at the start of the year that it was facing a 'difficult market backdrop'. Pure battery electric cars made up just under a fifth of the new car market last year. This is despite the Government's zero-emission vehicles (Zev) mandate requiring carmakers to ensure 22% of their sales were pure electric. EDF, which currently owns 53% of shares, said the company has consistently been reliant on it for funding and financial support. Pod Point said on Thursday it has been impacted by the slower-than-expected adoption of EVs and increased competition, meaning it has struggled to make a profit. EDF said acquiring the business would provide 'long-term stability' that would enable it to invest in its charging products. It has offered 6.5p per Pod Point share, valuing the company at about £10.6 million. It needs to be approved by shareholders. The business floated on the London Stock Exchange in 2021 and was valued at about £350 million, but saw its share price drop rapidly from the 275p it peaked at. Its shares were suspended in April after receiving a takeover approach from EDF, and saying it would therefore have to delay publishing its full-year financial results.
North Wales Chronicle
3 days ago
- North Wales Chronicle
EDF to buy Pod Point for £10.6m amid ‘slow' electric car adoption
The energy giant said a takeover was the 'only realistic prospect' of allowing Pod Point to keep operating as a business for the future. EDF was already a majority shareholder and the deal means it will take over the rest of the group. Pod Point, which has a network of more than 250,000 charging points in the UK, said at the start of the year that it was facing a 'difficult market backdrop'. Pure battery electric cars made up just under a fifth of the new car market last year. This is despite the Government's zero-emission vehicles (Zev) mandate requiring carmakers to ensure 22% of their sales were pure electric. EDF, which currently owns 53% of shares, said the company has consistently been reliant on it for funding and financial support. Pod Point said on Thursday it has been impacted by the slower-than-expected adoption of EVs and increased competition, meaning it has struggled to make a profit. EDF said acquiring the business would provide 'long-term stability' that would enable it to invest in its charging products. It has offered 6.5p per Pod Point share, valuing the company at about £10.6 million. It needs to be approved by shareholders. The business floated on the London Stock Exchange in 2021 and was valued at about £350 million, but saw its share price drop rapidly from the 275p it peaked at. Its shares were suspended in April after receiving a takeover approach from EDF, and saying it would therefore have to delay publishing its full-year financial results.
Rhyl Journal
3 days ago
- Rhyl Journal
EDF to buy Pod Point for £10.6m amid ‘slow' electric car adoption
The energy giant said a takeover was the 'only realistic prospect' of allowing Pod Point to keep operating as a business for the future. EDF was already a majority shareholder and the deal means it will take over the rest of the group. Pod Point, which has a network of more than 250,000 charging points in the UK, said at the start of the year that it was facing a 'difficult market backdrop'. Pure battery electric cars made up just under a fifth of the new car market last year. This is despite the Government's zero-emission vehicles (Zev) mandate requiring carmakers to ensure 22% of their sales were pure electric. EDF, which currently owns 53% of shares, said the company has consistently been reliant on it for funding and financial support. Pod Point said on Thursday it has been impacted by the slower-than-expected adoption of EVs and increased competition, meaning it has struggled to make a profit. EDF said acquiring the business would provide 'long-term stability' that would enable it to invest in its charging products. It has offered 6.5p per Pod Point share, valuing the company at about £10.6 million. It needs to be approved by shareholders. The business floated on the London Stock Exchange in 2021 and was valued at about £350 million, but saw its share price drop rapidly from the 275p it peaked at. Its shares were suspended in April after receiving a takeover approach from EDF, and saying it would therefore have to delay publishing its full-year financial results.
