Rising staff costs are the factor most likely to negatively affect business in 2025, according to 40% of dealers.
Starline research revealed that dealers are also worried about higher costs for stocking (38%), premises (38%), compliance (34%) and vehicle preparation (33%).
Paul Burgess, CEO at Startline Motor Finance, said: “While pressure for pay rises is probably lessening, the increase in employer National Insurance announced in the Budget is no doubt a worry for many.
“Seeing concerns over stocking, premises, compliance and preparation costs is perhaps not a surprise but it is noteworthy that dealers believe that they will continue to face ongoing rises in these areas at a time when inflation has fallen back to much lower levels than we have seen in recent years.”
Other issues mentioned include falls in vehicle sales (34%), servicing income (21%), finance commission (19%), add-on sales (19%), and aftersales income (12%).
Confusion over the ZEV Mandate was mentioned by 14%.
Burgess said: “It’s interesting that vehicle sales are the top concern when it comes to reduced income and perhaps suggests there is a degree of worry over the economy in general in 2025. Some dealers clearly think the general used car market could take a turn for the worse.
“The ZEV Mandate is also on the minds of dealers and we are hopeful that the current consultation will provide effective and practical help when it comes to both new and used electric car sales.
“The government says it is in ‘listening mode’ so let’s hope the motor industry’s concerns are being heard.”