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From the Managing Director – December 2018

In Australia there are 3,500 new car dealership sites; the new car industry contributes $15 billion to the economy, employs 70,000 people directly and 150,000 indirectly, pays $6 billion a year in wages and generates $4 billion in tax revenue.

So it’s a big industry, however we keep hearing in the media that it is under threat by disruption from all sides; whether it is electric cars, ridesharing, cars being sold directly on the internet, self-driving cars, and the like. All of these things may happen and some are already beginning to happen. It is up to us to adapt and react quickly enough to not be left behind. Also it is important to keep growing the business, as our margins are being squeezed and it is becoming more and more important to have economies of scale.

Here are a few examples of what we have been doing recently have planned in the coming year:

  • Penfold Hyundai Dealership in Doncaster, was purchased in July this year. This is located at 825 Doncaster Rd, opposite our Audi Dealership in Doncaster.
  • New Audi Dealership at Waverley, which we have begun work on and plan to open the Service Department there very soon with Sales starting in the second half of next year, once we complete a showroom facility at the street frontage of the building. This is located at 809 Springvale Rd, between Wellington Road and Dandenong Road.
  • We are relocating Doncaster Volkswagen to a new site.  This is to be located next to the Doncaster Hyundai Dealership and will be a new 12 car showroom with a renovated 12 bay workshop. We plan to have this completed by the end of next year.
  • I am also very happy to be able to announce that we have in the last few weeks come to an agreement to purchase Graeme Powell Mazda, which we will rename Frankston Mazda. This is a major purchase of a Mazda dealership that has been in operation under the same ownership for many, many years. It will increase our staff numbers and our turnover by about 20%. We believe this acquisition will be great for all of us and the staff currently employed there. We take over this business at the end of January 2019.

So, as you can see, we are investing significantly in the car business over this year and next year.

We have great faith in the future of the retail car industry and again thank you for your continued business and support. Wishing you all the best for the Festive Season.

Greg Johnstone
Managing Director