UK industry opposes dealership closures amid latest COVID lockdown

LONDON -- The British auto industry is fighting against new lockdown measures that will force showrooms in England to close from Thursday until Dec. 2 as the country struggles to control the coronavirus pandemic.

The SMMT industry association said it was seeking “urgent clarification” from the UK government on what the new measures mean for automotive retailing.

“Auto manufacturing must have its showrooms open,” SMMT CEO Mike Hawes wrote on Twitter.  “We need to keep the economy turning -- safely -- and prevent wider job losses.”

Under the latest lockdown, factories are allowed to continue operating.

Dealerships will be closed to walk-in customers but they will be able to hand over cars ordered online in a so-called "click and collect" service.

“The handover will be outside so bring a coat,” Robert Forrester, CEO of dealer group Vertu Motors, said in a statement posted on the website of the company’s Bristol Street Motors brand.

Daksh Gupta, CEO of dealer group Marshalls, questioned why garden centers will be allowed to remain open during the lockdown while dealerships must shut. "Why can these remain open and car showrooms with more space and can’t?" he tweeted on Sunday.

Dealerships should be allowed to continue to sell cars with measures such as social distancing because showrooms are generally large buildings with fewer customers than other stores, according to the SMMT. The SMMT’s Hawes pointed out that dealers were “proven safe and secure, a very different environment from other retail premises.”

The UK’s parliament will vote on the measures on Wednesday, but the government’s decision is expected to be ratified. 

The latest coronavirus restrictions are stricter in England than in the other nations that comprise the UK. Wales forced dealerships to shut for new-car sales from Oct. 23 until Nov. 9, while in Scotland showrooms can stay open.

England represents the biggest proportion of Britain’s new-car sales in the UK at 87 percent of the total through August. The UK is Europe’s second-largest car market after Germany.

The impact of the first lockdown, which ran from March 23 until June 1 in England, reduced UK car sales by 33 percent to 1.2 million by the end of September, compared with 1.9 million the year before.

The COVID-19 pandemic is encouraging online sales.

Vertu’s Forrester said his company has more tools in place to cope with the latest lockdown.

“We are in a lot better place for the next few months, so I’m less worried if there was another lockdown,” Forrester said during a recent panel discussion on the future of digital retailing hosted by Automotive News Europe on Oct. 22.

Vertu deployed its 30 in-house software developers to change the way the car buying process was completed.

“During the last lockdown we accelerated a lot of the activity around the customer journey, so not just the finance documents, but every single document can be now be signed digitally,” Forrester said. “The customer can now do everything from his sofa that you’d expect to do in a showroom apart from actually test-drive the car.”

The UK is following other countries that are introducing restrictions to slow down a surge in coronavirus infections.

France ordered showrooms to close as until Dec. 1. German dealerships are allowed to stay open during the country's new lockdown.

Dealerships will also remain open for business so far in Spain and Italy.

UK car production has been hit hard by the coronavirus lockdowns globally and the uncertainty surrounding the UK’s future trading relationship with the European Union when Britain leaves the single market on Dec. 31.

Output declined 36 percent in the first nine months. The SMMT predicts a year-end final figure of 885,000, the first time production will have fallen below 1 million since the financial crisis in 2009.