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17 August 2004
The Scotsman
Arnold Clark's sales show little sign of stalling

SIR Arnold Clark, the Scottish car dealer, expects another 30 per cent profits growth at his company in 2004 as he nears a half-century in charge of the company.

The 76-year old, who received a knighthood at the start of the year, told The Scotsman that profits were likely to jump from £44 million to more than £60m in the year to end-December - despite rising interest rates.

And the car dealer will cement its position as Scotlandís largest private company, with a 13 per cent rise in turnover to £1.65 billion - based on a jump in all car sales from 150,000 to 180,000.

Sir Arnold said: "All the aspects of the business are coming together nicely - I see no interruption to the current growth pattern."

His prediction of a 17 per cent leap in car sales - which includes both new and second-hand - compares with an expected rise in UK sales of around 2 per cent in both categories.

The Society of Motor Manufacturers and Traders (SMMT) says Scotland is growing at a faster rate to the rest of the UK, but has warned that the market cannot be sustained amid rising interest rates and fuel prices.

Sir Arnold conceded that there had been a drop in new car prices in the UK over the course of this year, but that the trend had had "no drastic effect" on his business.

"Interest rates are still at historically low levels and we are selling enough cars. It wasnít easy to bring the business to this level - itís been 50 years in the making."

He added that the firm was financially ready for any downturn, with £30m in the bank and no debt-pile.

The Arnold Clark group was founded out of just one showroom in 1956, but has expanded to 127 outlets and employs over 7,000 staff.

Sir Arnold has been running the business as chief executive and chairman since its humble beginnings and still spends his time driving around the country visiting the companyís many outposts. He said yesterday that he had no plans to scale back his impressive workload despite his age - while he added that a stock market flotation was "totally out of the question".

The company is still looking to expand its portfolio and has picked up three new dealerships south of the Border in the past week.

Sir Arnoldís strategy is to wait for small dealers with one or two outlets to decide it is time to sell up, before taking the property off their hands.

He said: "We never have any formal plans to buy out dealers, but wait for willing sellers to come to us." Two of the recently acquired outlets are in the north of England, while the third has yet to be signed off.

Arnold Clark could come under pressure from Sunderland-based rival Reg Vardy over the coming year, as the firm has pledged to expand its operations to take advantage of the Scottish market.

The two groups are similar in size, although Vardy has slightly fewer sites at just 92.

Sir Arnold said: "Competition is the spice of life. I get on well with Sir Peter Vardy and enjoy competing with him."

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