The Colonial Motor Company (CMO) AGM 2024 presentation summary

Market environment and industry trends

• New vehicle registrations have declined, with oversupply and increased competition driving down margins.

• Hybrid and PHEV vehicles are favored over BEVs, and the Clean Car Standard is influencing market dynamics.

• Used vehicle market volumes are stable, with higher demand for lower-value and 'near new' used vehicles.

• Heavy truck market volumes are stable but the outlook is cooling, with a backlog of trucks awaiting bodybuilding.

• Tractor market faces volume decline, oversupply, and a shift away from high horsepower models.

Operational performance and strategic initiatives

• Dealerships have maintained or grown market share despite lower trading profit and tough conditions.

• Investments continue in dealership facilities, digital capabilities, and data analytics to enhance performance.

• Focus remains on supporting brand partners and preparing for next-generation vehicle launches, including electrified Ford models and Mazda CX-80.

• Southpac is preparing for the launch of the next generation DAF truck, maintaining elevated inventory during the transition.

• NZ Automotive Limited is building momentum in light-duty trucks, with a milestone Diesel Automatic range arriving in 2025.

Financial and business outlook

• Margins are under pressure across segments, but sales volumes are stable or ahead of the market.

• Inventory costs remain high, but lower interest rates may provide some relief.

• Dealers are realigning cost structures and inventory to adapt to market changes.

• Increased investment is available to grow dealer capability, especially in used vehicles.

• The company is well positioned to capitalize when the market recovers, though the timing is uncertain.