May 2020

NEWS 6 AFTERMARKET MAY 2020 www.aftermarketonline.net Garages gain insolvency lifeline Garages that are struggling as a result of the Coronavirus pandemic could be supported by temporary changes to the insolvency system. The amendments would mean businesses that cannot pay debts as a result of the crisis would not be made to declare bankruptcy. Explaining the amendments, Business Secretary Alok Sharma said that as a result of the changes, company directors whose businesses were being hammered by the crisis would receive some protection: “These measures will give firms extra time and space to weather the storm and be ready when the crisis ends while ensuring creditors get the best return possible in the circumstances.” The new rules will allow businesses that are forced to restructure to go on acquiring supplies. The changes would also suspend wrongful trading provisions for company directors, for a limited period. “All of the other checks and balances that help to ensure directors fulfil their duties properly will remain in force,” Alok Sharma added. The changes apply retrospectively from 1 March. Garages ‘more valued’ More than 60% of garages in the UK could have shut their doors since the COVID-19 lockdown began, a survey suggests. Key closure causes cited in the survey, conducted by sector PR and marketing agency Impression Communications, were the significant drop in business caused by social distancing measures, and the decision to extend the MOT from 30 March by six months. Other respondents noted practical reasons such as childcare and the inability to source parts as motor factors had also closed. The survey also found that around 25% of motor factors may be shut, and those that remain open are running 50% below capacity. Those who closed cited public pressure as a key cause. On the supplier front, 67% of those surveyed said they were open, 25% were partially open, and 8% had shut. On their awareness of business support measures, 88% of garages in the survey had heard of the Coronavirus Job Retention Scheme, through which staff can be furloughed on 80% of their salary up to £2,500 per month. When asked about the kind of online training they would want to pursue when at home or on furlough, 73% of garages said EV and hybrid training. Demand for product had reduced dramatically, in some cases by up to 85%. Business support, product and sales training were key for suppliers during this time, the survey revealed. Commenting on the findings, Impression Communications Director Mark Field said: “It’s clear that the MOT extension has had severe repercussions throughout the supply chain. Close communication is key as the market is changing on an almost daily basis with businesses reopening and garages receiving much needed support in the way of grants.” Independent garages are now more valued by the general public than they were before the UK’s Coronavirus outbreak, according to a new survey. 87% of participants in the survey, performed by online car maintenance service provider Fixter, said they believe that ‘essential businesses’ such as local garages have responded with appropriate procedures to deal with Coronavirus and the government social distancing measures. Meanwhile, 89% of customers who rely on their cars now think that it is more important than ever to keep it in a good condition. 99% also said they believe NHS staff and other key workers should be given special discounts for car maintenance. Limvirak Chea, Co-Founder and CEO of Fixter, said: “We found that the trust in garages has substantially increased and that the general public value essential businesses more, as they look at them in a different light and rely on them more than ever.” Coronavirus causes 60% of garages to close Follow us on Facebook @aftermarketmagazine Ben is reaching out to those struggling in the midst of the Coronavirus outbreak, with a new statement on how the organisation can help, as well as new dedicated webpages for providing support during COVID-19 crisis. The organisation wants those working in the industry to know it is there for them. Ben’s statement observed: “Ben will continue to be here for the automotive community providing health and wellbeing support for automotive people and their family dependants. In response to COVID-19 we are aiming to fast- track access to Information, Advice and Guidance (IAG) specifically for individuals who reach out to us for financial or money concerns related to the current COVID-19 situation.” The new content can be found here: https://ben.org.uk/our-services/health- and-wellbeing/coronavirus-help/ Topics covered include stress and anxiety, money and debt, home working and connectedness and loneliness. Support and advice from Ben