Car dealership Peter Vardy saw its turnover reach nearly £591 million ahead of its decision to close its Dundee premises.
Dozens of jobs have been lost following the closure of used car showroom CARZ in Broomhill Road.
The purpose-built dealership opened six years ago at a cost of £7m.
However, the site, along with a CARZ in Glasgow, has now shut with the loss of 118 jobs.
The firm said 30% of the people employed at the sites had been redeployed.
New car sales boost
The motor group counts Perth, Kirkcaldy and Aberdeen sites among its six car supermarkets in Scotland.
It also operates seven franchise dealerships for Jaguar, Land Rover, Porsche, BMW, Mini, Ora and MG.
Newly filed accounts for Peter Vardy Holdings show the group had sales of £590.5m in the year to December 31 2022, an increase from £560.7m in 2021.
Pre-tax profits decreased from £11m to £6.1m.
Boosting the company performance was strong demand for new cars.
Peter Vardy, group chief executive, said: “Profitability has been significantly impacted by a reduction in used car supply and the resultant margin erosion unfortunately impacting the majority of the group’s retail outlets.
“However, the group has seen outstanding financial successes in the year in the new car department.
“The new car contribution to group profitability rose by £3.9m or 79.6% year on year.
“Whilst new car volume actually reduced by 28.1% due to an instability in supply, our average margin per vehicle increased by £3,188 per vehicle, as a result of selling more high end premium product in our Porsche, Jaguar Land Rover and BMW and MINI
franchises.”
Skilled workers shortage
In April 2022, the company made the decision to close the CARZ Dalgety Bay business to combine the market area opportunity for the Fife region into the Kirkcaldy dealership.
The average number of employees across the group increased from 998 in 2021 to 1,008 in 2022.
But a warning has been made about a shortage of skilled workers with attention perhaps turning to more apprenticeships.
It said: “The group has been significantly impacted in the year, and will be in the future by the unprecedented shortage in the labour market, particularly mechanical technicians.
“The result has seen a wage inflation of nearly 10% across all job roles. The board will take this into consideration in its growth plans in the future, including increasing its investment in apprenticeships across all job roles.”
CARZ Dundee history
The switch to the Dundee site becoming CARZ, specialising in used vehicles, came in 2020, after new car supply dried up due to Covid.
Last September Peter Vardy highlighted strong used car sales as a major contribution to profits.
In June disgruntled drivers held a protest claiming the dealership sold them vehicles with underlying issues.
The Peter Vardy site was once home to another major employer – Dundee’s famous Valentines card factory.
