Inchcape warns over car sales

The firm, which sells new and used cars in 26 countries and employs around 14,300 people worldwide, saw UK sales drop by 3.1 per cent to £2.05bn in the year to December 31.

Inchcape, which deals with marques including Audi, Mini, Jaguar, Land Rover, Mercedes-Benz and Porsche, said the climate in the UK and Europe will remain tough as austerity measures hit consumer confidence and spending power.

But it unveiled a better-than-expected group performance, driven by its Asia-Pacific operations, with overall pre-tax profits increasing 6 per cent to £227.7m.

The decline in UK sales was not as severe as the wider market, Inchcape said, which saw a 4 per cent drop in sales in 2011, due to the tough comparisons with 2010 when the Government scrappage scheme was still in play.

Inchcape, which has 117 retail outlets in the UK, was awarded two further franchises in the period, a Porsche dealership in Portsmouth and Volkswagen outlet in West London.

The company also runs a fleet management and leasing arm, which has 50,000 vehicles in the UK.

James Dilks-Hopper, analyst at Numis Securities, said the group profit performance was “particularly impressive given the uncertain macro environment and the impact from the Japan earthquake”.