Fleet News

Group to expand dealer network and consolidate rental

TRANSPORT solutions group Arriva plc is to continue to expand its dealer network, while its rental operation is to go through a period of consolidation. The north east-based company announced pre-tax profits of £47.6 million for the first six months of 1998 - in line with the same period last year - on turnover up 17% to £822 million (1997: £702 million) and operating profit improving to £69 million (1997: £66.2 million).

The results were influenced by a strong performance from the company's fast-expanding bus business, but profits were offset by the decline in fortunes in the finance division. Motor division pre-tax profits declined fractionally to £7.5 million (1997: £7.6 million) on turnover up £422 million from £335 million, mainly through increased corporate sales to fleets. However, the increased contribution from new car sales was offset by a smaller contribution from used car sales in the dealership network and from the sale of ex-daily rental vehicles.

Expansion of the motor division is expected to be partly financed by the sale of the finance division. Now comprising 40 outlets, further franchises and more locations are expected to be announced this year. Meanwhile, Arriva Vehicle Rental expanded its daily rental operations to almost 60 sites with Hodgson saying: 'The rental operation will undergo a period of consolidation before beginning to achieve the benefits of an enhanced national network.'

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