Group 1 Automotive, the purchaser of Inchcape, has recently reported significant global profits of nearly £600 million for the first quarter of the year. This announcement coincides with their progressing acquisition of Inchcape.
Earlier in the month, Group 1 Automotive finalised a £346 million deal to acquire all of Inchcape’s UK retail operations, marking a substantial development in the automotive industry. While the acquisition is pending regulatory approval from the Financial Conduct Authority, Group 1 Automotive remains steadfast in its commitment to delivering strong performance.
The recently published financial statements revealed that Group 1 Automotive achieved a global gross profit of $742.6 million (£596 million) in the first three months of 2024, representing a 2% increase compared to the same period last year. Additionally, the company experienced a notable 8.2% rise in global revenues, amounting to a staggering $4.5 billion (£3.6 billion).
In the UK market, Group 1 Automotive’s operations, encompassing prestigious car brands such as BMW, Mercedes, Audi, VW, Seat, Skoda, Jaguar Land Rover, Kia, Toyota, and Ford, along with several used car centres, generated $821.8 million (£657 million) in revenue – up from $784.7 million (£626.2 million) in Q1 2023. Despite a slight decrease in gross profit from UK operations compared to the previous year, the company achieved an average gross profit of $2,760 (£2,203) on each new car sold, and $1,550 (£1,237) per used car.
In terms of sales volume, Group 1 Automotive sold 8,961 new cars and 14,038 used vehicles in the UK during Q1. Remarkably, the UK accounted for 20.2% of all new vehicle sales across the company, with the remaining 79.8% attributed to the US market.
Daryl Kenningham, the President and CEO of Group 1 Automotive, commented, “Our U.K. team rebounded nicely from the challenging fourth quarter of 2023, producing record quarterly revenues from parts and service and new vehicles, as well as increasing used vehicle sales volumes over 19% sequentially. We saw some of the benefits of our UK cost reduction efforts in the first quarter of 2024; however, we expect to realise the full benefit of our cost reduction efforts in the second quarter and beyond. We believe the UK. business is well positioned and look forward to the expansion of our UK. operations with the pending acquisition of Inchcape’s U.K. retail automotive business planned for Q3 2024.”
Evidently, Group 1 Automotive’s exceptional financial performance highlights its resilience and strategic initiatives amidst a dynamic and competitive industry landscape. As the company prepares for the next phase of its growth through the impending acquisition of Inchcape’s UK retail automotive business, the automotive sector anticipates further developments.