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UK dealer Lookers expects record full-year profit

UK dealer Lookers expects record full-year profit

Britain’s fourth-largest car dealer, Lookers, expects to post a full-year pretax profit of more than £60 million (€75 million) after record sales lifted first-half pretax profit by 36 percent to £40.2 million.

The firm, which sells nearly 120,000 new and used vehicles annually in Britain, said the sales growth had been largely due to the ready availability of low-cost credit.

“It’s being driven by these finance packages which are just unprecedented in terms of value for money,” Lookers CEO Andy Bruce said.

Up to four out of five new-car purchases are now made on credit in Britain, with many customers effectively renting a car — typically for three years — before trading the vehicle in for a new model under a scheme known as a personal contract plan.

Earlier this month another British stock exchange-listed car dealership, Pendragon, reported an increase in its underlying pretax profits of 39 percent to £9.2 million.

Faster-than-expected first-half growth in new car sales has prompted the UK’s Society of Motor Manufacturers to revise its forecast for the full year. It had been expecting a rise of 6 percent in 2014 but on Aug. 6 changed that forecast to 8.1 percent growth to 2.45 million units. That would be the best sales result since 2004.