Automotive insolvencies drop in May
Rate at lowest since December 2007
Nottingham , 2 July 2010 — The rate of business insolvencies[1] for the automotive industry almost halved from 0.12 per cent in May 2009 to 0.07 per cent in May 2010, according to the latest Insolvency and Late Payment indices from Experian®, the global information services company.
As well as seeing a year-on-year fall, the rate dropped from 0.08 per cent last month to 0.07 per cent, a low not seen since December 2007.
The financial strength 2 of the automotive industry also saw a slight improvement both year-on-year and month-on-month, going up to 79.71 from 79.31 in May 2009 and from 79.67 in April 2010.
However, automotive businesses saw a slight increase in late payment with automotive businesses paying their bills16.67 days after agreed terms in May last year, rising to 16.86 days late in May this year.
Mark Wilkinson, Sales Director for Experian Automotive business, said: “The decline in insolvencies and improvement in financial strength in May is a good result for the industry in the current economic climate.
"Feedback from automotive businesses in the UK is that chasing debt is a key issue. For the financial strength of the industry to remain buoyant, keeping in touch with supplier terms, and managing risk around those, will remain key.”
Insolvency rate |
May-10 |
May-09 |
April-109 |
Automotive |
0.07% |
0.12% |
0.08% |
All sectors |
0.08% |
0.10% |
0.10% |
Source: pH, an Experian company
Insolvencies |
May-10 |
May-09 |
% Change from 09 |
April-10 |
Automotive |
24 |
43 |
-44.2 |
29 |
All sectors
|
1,491 |
2,023 |
-26.3 |
1,818 |
Source: pH, an Experian company
Financial Strength Score |
May-10 |
May-09 |
% Change from 09 |
April-10 |
Automotive |
79.71 |
79.31 |
0.5 |
79.67 |
All sectors |
80.70 |
79.98 |
0.9 |
80.76 |
Source: pH, an Experian company
Days Beyond Term |
May-10 |
May-09 |
% Change from 09 |
April-10 |
Automotive |
16.86 |
16.67 |
1.1 |
16.25 |
All sectors |
20.91 |
23.63 |
-11.5 |
21.07 |
Source: pH, an Experian company
ENDS
Contact:
Natalie Hale
0115 992 2645/07971 709 274
About Experian
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For more information, visit www.experian.co.uk.
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[1] The insolvency rate is calculated by comparing the number of businesses that failed with the total automotive business population in Great Britain.
2 The financial strength score predicts the likelihood of a business failing in the next 12 months, with 100 being the least likely to default and 1 being the most likely.