Motorpoint dealership
Motorpoint has reported improved sales amid an uptick in demand for nearly-new vehicles / Image source: Motorpoint
  • ‘Strong’ Q4 performance
  • Retail volumes up 9%
  • Share buyback continues

Used car retailer Motorpoint (MOTR) has reported an improvement in trading in the new calendar year amid an uptick in consumer demand for nearly-new vehicles.

Margins gradually improved through the fourth quarter to March 2024 too, as the Derby-headquartered company increased stock turn and worked through the inventories affected by the used car price correction witnessed in the third quarter.

Given this positive momentum, full year pre-tax losses are now anticipated to be at the ‘favourable end’ of management expectations, although the shares were off 1% at 132.5p in morning dealings, having already staged an impressive 20% year-to-date rally.


Emerging from a period in which high inflation, rising interest rates and consumer uncertainty affected demand for second hand cars, Motorpoint said the positive momentum experienced at the start of the calendar year continued through February and March.

As a result, retail volume increased by 9% year-on-year in the fourth quarter ended 31 March 2024, with Motorpoint enjoying profitable trading across the opening three months of the year.

‘Consumer demand has picked up, and we have benefitted from the numerous enhancements made to our digital presence during the past year which, among other things, is generating strong website traffic,’ said Motorpoint, which has previously taken decisive actions to right-size its business.

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CEO Mark Carpenter said he was ‘delighted that the difficult conditions experienced in 2023 have eased in Q4 and, combined with our focus on driving operational excellence through a programme we call Brilliant Basics, has meant that Q4 was characterised by consistent profitability.’

Carpenter added: ‘We are achieving growth, increasing stock turn and improving margins, and this is expected to continue into full year 2025 as supply improves following recent new car registration growth.’


AJ Bell investment director Russ Mould said things are looking up for the used car sector.

‘Consumers under financial pressure have been pulling back from making big ticket purchases,’ explained Mould.

‘Some people need a vehicle to get from A to B no matter what’s happening in the world, but many can view a car as a non-essential purchase. They keep their existing motor and hope it lasts longer until they’re financially able to switch.

‘Motorpoint sells nearly-new cars so these can be meaningful purchases for households. This isn’t like buying a TV or new clothes – it involves shelling out a substantial amount of hard-earned cash so the customer needs to be sure they can afford it.’

Mould added: ‘The backdrop should improve further for Motorpoint once the Bank of England starts to reduce interest rates. That action could make households feel as if the worst is over and that they are able to get their finances back on track. It also helps that wage growth has been fairly decent, on average.’

House broker Shore Capital said Motorpoint’s momentum implies ‘upward pressure to forecasts if sustained into full year 2025, we will know more in mid-June, though evidence for a recovery is building. We reiterate our view that Motorpoint has a high-quality and vastly experienced management team, a distinctive operating model and the right omnichannel strategy to succeed in a normalised vehicle market. Such times may be upon us.’

DISCLAIMER: Financial services company AJ Bell referenced in this article owns Shares magazine. The author of this article (James Crux) and the editor (Steven Frazer) own shares in AJ Bell.


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Issue Date: 04 Apr 2024