Tag Archive | "Coronavirus"


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Halfords has secured a £25m funding package to help the business recover from the crisis.

The money comes from the Coronavirus Large Business Interruption Loan Scheme and was granted by the Redditch retailer’s existing consortium of lenders, including HSBC.


Like all businesses, Halfords was hit by the crisis, although as it is a bike shop most of its retail stores were able to remain at least partially open and its Autocentre garage network stayed open offered a contactless vehicle  pick up and delivery service

Loraine Woodhouse, Chief Financial Officer at Halfords, said: “While our market-leading motoring and cycling businesses have strong macro tailwinds, this additional contingency funding gives us even greater confidence in our ability to trade our way successfully through the current uncertain environment. We would like to thank our lenders for their ongoing support.”


Akhil Shah, Relationship Director at HSBC UK, added: “Like all retaiHalfordslers, the business has faced unprecedented challenges. As the lockdown restrictions ease and more of its stores open, this additional funding gives Halfords the confidence and the headroom to continue serving its customers effectively.”



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Automotive industry charity, Ben has announced the cancellation of its annual flagship event, Ben Ball, in December. As a result of coronavirus, the event won’t be taking place this year for the first time since World War II, contributing to a potential income shortfall of £1m for Ben this year.

Having asked those who regularly attend Ben Ball if they would consider attending this December, the majority of past attendees said they wouldn’t due to concerns surrounding safety in light of the virus and uncertainty around budgets.


The charity continues to support more and more automotive industry people with their health and wellbeing during this challenging time. Now, more than ever before, automotive people need the support of Ben to help them cope with anxiety, depression, money worries, bereavement and loneliness. However, this increased support comes at a time when the charity’s income has fallen as a result of the Coronavirus and the impact it has had on the finances of companies and individuals in the industry.


The cancellation of Ben Ball, along with the postponement of other fundraising events, as well as a decline in donations, means Ben is anticipating a £1m income shortfall this year, similar to many other charities. This is why the charity is appealing for those who can, to continue their support and keep providing vital funds so Ben can always be there for those who are struggling.

Matt Wigginton, Fundraising Director at Ben, said: “Making the decision to cancel Ben Ball is one of the hardest I’ve ever had to make, however with the uncertainty of the situation surrounding COVID-19 and the impact it has had on our industry, it was, unfortunately, inevitable. 

“We are living through unprecedented times and this means making tough decisions, but also being adaptable, so we plan to run a virtual fundraising event on 9th December instead, which we hope our industry will get involved in. So watch this space, we’ll reveal more in the coming months!

“We would also like to take this opportunity to give our heartfelt thanks to those who have continued to support Ben during this time – your support is more valuable now than ever before. We look forward to seeing friends, old and new, at next year’s event!”

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Halfords Autocentres has predicted MOT bookings will peak at 85 percent over the average in October. The garage network has carried out analysis across the industry which suggests that an additional 1.7m drivers will try to book their MOT in October, on top of the normal demand of about two million vehicles. 


Accordingly, the network has launched a campaign to get motorists to book their vehicles in early, regardless of whether they have time left on their MOT extension. The initiative will focus on concerns some motorists may have about their vehicles being roadworthy after a period of idleness. 


Andy Randall Managing Director from Halfords Autocentres said: “We’re urging drivers to beat the rush and book their vehicles in this summer. October and the winter months, are going to be much busier than normal when motorists will be joining millions of others who have held off getting their MOT done. Our research shows that almost half of motorists are worried about the roadworthiness of other cars on the road so those that get theirs done can be much more confident that their cars are properly roadworthy. The MOT test remains the best way to ensure vehicles are safe to drive.”

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In his Summer Statement, Chancellor Rishi Sunak has pledged a £1000 bonus for all employers who retain previously furloughed staff beyond the end of January.

The Chancellor has also pledged investment into modern apprenticeships, with a £2,000 grant available in England for employers that take on apprentices under 25 years old, and £1500 for those over 25. Additional measures, such as a reduction of VAT on takeaway food will appeal to businesses such as petrol station forecourts, which have been hit especially hard by the crisis.

However, new car dealers and vehicle manufacturers may be disappointed that there was no mention of a new scrappage scheme in the speech.

We’ll bring you reactions to the Statement from the aftermarket as we get them. 


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The Autopromotec trade exhibition will move to 2022, organisers have confirmed.

Autopromotec entrance

The biennial show, held in Bologna during Frankfurt off years, has now been rescheduled to 25-28 May, 2022 in order for ‘companies to invest their financial resources at a more appropriate moment’.


“The Covid-19 pandemic continues to register high rates of contagion, and severe limitations to international travels persist”, says Renzo Servadei, Autopromotec CEO. “A proper planning on the part of all the players of the sector is crucial to create a high-level event, but the uncertainty related to the measures to deal with the sanitary crisis makes it difficult to national and international exhibitors and visitors to plan their business travels well in advance.”


Other trade shows have also changed schedule out of necessity. Automechanika Frankfurt will now take place in 2021, and Paris-based EquipAuto has indicated that it is considering a change in ‘positioning and format’ of its event.

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BY: Susan Hopcraft is a partner in the Dispute Resolution team at Wright Hassall solicitors

Although the social distancing measures are slowly being relaxed, the lockdown has come at a cost for many businesses, with some losing their entire revenue overnight.

Understanding that a difficult period was around the corner, many owners decided to add business interruption (BI) cover to their already expensive insurance, believing they would be covered should the measures disrupt business operations.

Susan Hopcraft, Wright Hassall Solicitors

However, the cover hasn’t had the desired effect for many businesses and the Government has been urged to get involved, as a growing number of refused claims are recorded.

Starting class actions could offer one solution, but businesses must do more to push their claims and the government’s financial regulator (the FCA) is now taking an active interest. There may be policies in place that apply to coronavirus losses, for which additional premiums will have been paid.

 What are BI policies?

Standard business interruption covers a business for loss of income during periods when they cannot carry out business as usual due to physical damage: typically damage to the premises caused by a storm, fire or flooding.

The insurance might compensate the business for any increased running costs and/or shortfall in profits for a set period and financial limit.

Some policies have extensions that might apply to coronavirus losses, for which additional premium will have been paid. There are two main likely clauses:

 ‘Specific illnesses’ clause

Most extensions cover specific diseases, listed in the cover. These are diseases that are well known and understood. Covid-19 will not be named though, and this is likely to lead insurers to deny claims.

Businesses will feel aggrieved by that when they bought cover for this type of circumstance. The argument will be that the clause was intended to cover disease closure and the clause could not have named a disease that did not exist.

Some disease extensions are more general and do not specify certain diseases. In these cases, business interruption cover for Covid-19 is more likely to apply.

Usually Covid-19 must have been present at the premises or within a short radius. This is because business interruption is supposed to cover the short period while premises are shut down for a deep clean.

Access Denial

Another relevant extension is cover for losses as a result of people not being able to access the premises due to specific circumstances such as the police cordoning off an area due to an event such as terrorism.

The clause might cover inability to trade due to a government restriction, which is what has happened now with schools, then bars/restaurants directed by the government to close prior to a full lockdown. These clauses might cover loss, again depending on the wording.

Another issue arising out of businesses being temporarily closed is the need to let your insurer know if the insured premises are unoccupied.

There may be a clause in your property insurance that requires the premises to be occupied. However, the Association of British Insurers (ABI) has suggested that insurers will be more flexible over the requirements around these types of clause under current circumstances.

Current situation

For some businesses, the business interruption extension might be worded to enable recovery of losses due to coronavirus closure. For others, particularly where Covid-19 is not included in a specific list, cover may well be denied.

Insurers will say they do not cover pandemics and do not charge premiums commensurate with that exposure. They might also say that it is for government to bail out businesses, for example, by the furlough scheme because this pandemic is so widespread and unexpected that it falls outside what private insurance ought to cover.

Insureds will say that they were paying extra premiums to extend cover to deal with precisely this sort of risk. Just because the disease was not known, that should not exclude them from cover.

The government has asked the insurance industry certain questions. Mel Stride, the Chair of the Treasury Select Committee, wrote to the ABI on 25 March asking for data and information on the industry’s response to coronavirus.

The ABI replied and, swiftly after that, the FCA announced that it intends to bring action against certain insurers for a decision on whether Covid-19 losses are covered.

 Protecting your business

Given that many businesses have taken steps to protect themselves from such a scenario, there is little comfort that can be given to businesses who have had claims dismissed.

The uncertainty of the current situation means that a successful claim could make all the difference for those companies trying to weather the storm and come out the other side in a strong position.

If your business closes or is otherwise disrupted by coronavirus, you might have business interruption insurance to make up the deficit.

Your insurance broker can give you a preliminary view but, if you have tried that and the insurer has declined your claim, then contact a team of experienced lawyers for advice.

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It was reported in late April that more than 60 percent of garages had shut their doors as it had become infeasible to operate given the sharp fall in customer demand, disrupted parts supply chain and staff shortages caused by the lockdown. 

Now, though, the lockdown is being eased and UK roads are slowly starting to get busier. Alex Lindley, Managing Director of Nottingham-based garage chain Lindley’s Autocentres, told us how he’s gearing up for the new ‘normal’: “There are a lot of strategic challenges now, including making sure that we increase supply as the demand increases – timing is critical to maintaining the health of the company.” It’s worth remembering that, even if a garage has all staff at hand and a fully operational workshop, there are obstacles to overcome in terms of consistently speedy parts deliveries and maintaining a steady workflow as drivers adjust to post-lockdown life. 

Supply chain

The sustained health of factors and suppliers is a critical component in the aftermarket’s bounce-back. One such business, Chesterfield’s Autosupplies Group, is working hard to return to normality. Managing Director David Clarke said that, although “business dropped considerably” when the lockdown came into force on 23 March, it “has continued to grow steadily”, with the firm recording the biggest increase in call volumes after Easter. Garages were allowed to stay open, having been deemed essential businesses, but the situation was murky for suppliers, as Clarke explained: “Many of our van drivers have been stopped by Police and I would like to thank the IAAF for their support in providing the industry with a letter that confirms we are allowed to remain open and trade.” On 5 May Autosupplies announced that its Chesterfield, Barnsley and Rotherham branches were fully open, and that “teams at all three businesses are well practised in social distancing measures and are adhering to government guidelines, which we kindly ask customers to respect.”

Social distancing could be the biggest inhibiting factor in the build-up to ‘business as usual’. Among many other measures, the Best Practice guide – jointly published by IGA, SMMT, IAAF, Scottish Motor Trade Association and Garage Equipment Association – suggests posters are put up around the workshop or warehouse to remind customers and staff to keep their distance, a one-way system is put in place and sanitisers are always available. Euro Car Parts’ Marketing Manager Colin Cottrell outlined the actions of the factor chain: “We’ve made protective equipment like gloves, antibacterial gels and wipes readily available to all and are regularly cleaning our vans, branches and retail spaces. We’ve also set up Perspex screens on our counters and will wear latex gloves to serve customers and while on delivery routes.” 

Touchy subject

The biggest change for many will be the transition to a ‘contactless’ business model, which Autocentres’ Lindley has found ‘relatively easy’ to adhere to “once the plan was in place”. “The key to its success is to communicate with the customer,” he explained. “You need to make it clear what they can expect and what you expect from them. We are calling the customers the day before, followed by an SMS and an email.” Garage bosses would do well to consider how best to minimise unnecessary contact with customers while maximising workshop space. 

MOT extension

Aside from the critical issue of how to actually run a business, the question that industry bodies are now asking the government is if it will now cancel the universal six-month MOT extension that came into effect on 30 March [the end of the extension has of course been announced since this article was written – Ed]

The IMI’s Steve Nash thinks that although “the motives for the initiative were sound at that time, there are serious risks in the extension remaining in place now”. Chief among these, he said, is that traffic levels are beginning to build as people return to work, and it’s possible that some vehicles will not be in a roadworthy condition. “That’s a huge safety risk, but of more commercial concern for our sector is that if all motorists wait up to six months from when their MOT expired to get their vehicle tested there is going to be a big backlog of tests in the autumn and winter [see Alex Lindley’s predictive chart below] which could significantly overwhelm the sector,” he said. 

SMMT Chief Executive Mike Hawes concurred. “With government advice stating that workers should avoid public transport when returning to work, the use of private cars is likely to rise more sharply than it already has over recent weeks” he said. “A reconsideration of the six-month MOT extension needs to be made as soon as possible”. 

The Independent Garage Association and the IAAF have all voiced similar statements and written to DfT ministers. However, it is highly unlikely that a decision that has already been implemented will be changed now. 

Take the initiative

There are two schools of thought, however, and David Hoad, MOT Manager at Ashton-Under-Lyne’s Guide Bridge service centre, reckons a pragmatic approach could mitigate the effects of any custom lost to the extension. “The scheme has allowed key workers to stay mobile without worrying about the statutory requirement of having to have a current and valid MOT,” he said, noting that these individuals are the only ones who should have been driving under lockdown in any case. So, now that it’s here and shows no sign of being lifted, he advises garages to contact customers and explain to them you are now open and able to carry out the test. “Explain to them it is their responsibility to ensure their vehicle is roadworthy and that they can be prosecuted for not ensuring this, and the only way they can feel secure they have met this requirement is to bring the vehicle to you for inspection,” he advised, adding that it’s worth reminding customers that: “the extension is only there to give them the time to get the vehicle tested at the earliest opportunity.” 

Hoad’s views are backed up by ECP’s Cottrell, who observes that a proactive approach from garage managers could see customer rates quickly return to near-normal levels. He suggests that garages identify customers with overdue services or MOTs and offer them a booking slot of their choice, which, he says, “helps them to define their opening hours, understand the technician resource they’ll need and effectively manage their finances”. As an added incentive, he notes: “One garage owner we spoke to in the last couple of weeks reported a 43 percent uptake on the phone calls he made in a single day, and another converted 11 phone calls into bookings in one day.”

What’s most apparent, speaking to representatives from various sectors within the aftermarket, is that we’re firmly in the recovery stage now. There will be hardship ahead for all, with stringent distancing measures, weakened customer demand and an inevitable economic downturn to overcome, but the ball remains in the aftermarket’s court. Most, if not all, businesses can operate effectively with social distancing measures in place, and now that the roads are getting busier and garages are opening back up, there’s no reason to let the MOT extension stop the aftermarket from returning to rude health and keeping the nation’s vehicles safely on the road.  

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The government is consulting on plans to end the six-month MOT extension earlier than planned in line with easing lockdown restrictions.

According to the IAAF, the Government intends to amend the Motor Vehicles (Tests) (Amendment) (Coronavirus) Regulations 2020, which were brought in when lockdown began in late March, and exclude light vehicles from mandatory MOT testing.

An amendment would see change the end date of the MOT extension, which is currently set to expire on 29 March 2021. Drivers are given a six-month extension from the date their test was originally due.

An announcement will be made “as soon as possible”, said the trade body.

The DVSA’s consultation document outlines three options for ending the extension while allowing vehicle owners a grace period to obtain a valid test certificate:

  1. To return to mandatory MOT testing in two to four weeks from date of announcement (i.e. an announcement is made that extensions would not apply to any tests due two to four weeks after when that announcement is made);
  2. To return to mandatory MOT testing in four to six weeks from date of announcement;
  3. To return to mandatory MOT testing in six to eight weeks from date of announcement.

The IAAF quotes DVSA figures showing that, despite the extension, current test volumes are at more than 65% of normal levels, and more than 80% of test centres are “routinely undertaking some testing”.

The body adds that traffic levels are returning to normal, so “the longer these Regulations are in effect the greater the risks are to road safety”.

As of 15 June, retail outlets have been allowed to reopen with social distancing measures in place, and the hospitality sector is set to gradually begin operating again from 4 July. While garages have been allowed to operate throughout lockdown, the MOT extension was devised as a means of reducing unnecessary social contact, and to discourage people from leaving their homes.

IAAF members are encouraged to submit their views on the consultation with answers to the following questions:

  1. Do you have any views on the proposals to restart testing, positive or negative?
  2. Of the three periods mentioned above, which would be your preferred time for restart?
  3. Do you have any suggested amendments to the proposals?
  4. Do you have any concerns which you think have not been addressed?
  5. Do you have any other general comments?

Answers should be emailed to anns@iaaf.co.uk by 5pm today (25 June).

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Neil Jones is the head of the Corporate and Commercial team at Ansons Solicitors

Despite the massive impact the lockdown has had on the UK economy, many businesses have continued trading, although not all are recognised as essential services.

Push bike sales have enjoyed a 200 percent uptick, but the new car market dropped by 97 percent in April (with just 4,321 registrations), highlighting the struggle faced by some sectors.

Many business owners will be considering selling up, but now is not the best time and snap decisions should be avoided.

Buyers know the current situation offers bargains. Sellers should be careful when dealing with issues like due diligence, warranties, indemnities and price adjustment mechanisms, to ensure they do not accept much poorer terms of sale than they normally would.

The coronavirus crisis remains fluid and may cause buyers, after the purchase price and other terms have been agreed, to try to revisit terms and alter matters in their favour – a situation to be avoided.


Remember, the buyer is purchasing the long-term viability and potential of the business, which must be reflected in the deal’s terms.

If the deal was already in the process of being negotiated before the current crisis, then the buyer might wish to revise the terms to modify the price adjustment mechanisms.

Sellers can take steps to protect themselves, like asking for more payments upfront to avoid the risk of deferred payments, as the current volatility could impact the buyer as much as it does the seller.

Any seller would need to go through the disclosure process again to mitigate the risk of any claims, and revisit any relevant warranties in light of the pandemic, in case they need amending or qualifying.


Selling a business is a series of clearly defined steps, including securing the position of workers, minimising personal tax liabilities and deciding what expert advice is needed.

This could involve a corporate finance adviser, a tax accountant and a corporate lawyer, ideally experienced in the sector in which the business being sold operates. There’s no substitute for experience when identifying areas of risk.

When taking on an expert, a clear division of responsibilities and a fee structure should be agreed in writing so the seller can create the best possible picture of their business to maximise the sale price.


This can involve tidying up loose ends, selling under-used property or equipment, positioning major purchases or implementing strict stock management and credit control measures to maximise working capital and create a stable, longer-term financial pattern.

Currently, sellers are more likely to be offered a valuation that maximises the buyer’s chances of securing the business as cheaply as possible. The seller must evaluate the status of the buyer as carefully as they would normally to understand if they can fund the purchase.

It may be tempting to rush due diligence checks in a ‘buyers’ market’, but this would be a mistake by the seller and the kind of panicked response the buyer, who may be highly geared themselves or only have vague financial promises, will hope for.

If part of the purchase payment is to be deferred, what guarantees are in place with regard to those payments? Do they reflect the reality of the current pandemic- related market conditions?

Additionally, if payments are linked to future business performance, will the seller have ongoing influence on the business? Do the figures reflect the impact of coronavirus?

During the lockdown and the economic uncertainty that will follow, buyers will place increased emphasis on due diligence, more particularly on aspects such as insurance, supply chain risks, business continuity and employee health and safety policies.

As a seller, it’s best to be transparent, which not only demonstrates good faith, but also helps protect against any future claims if any information was not fully disclosed.

Sellers should rely on their expert advisors to fully interrogate the details of any offer, which these advisors will view dispassionately – it’s what the seller needs and what the bargain-hunting buyer fears.

When it comes to deferred pricing mechanisms or earnouts, the seller must ensure they are fully covered with regard to the pandemic’s impact on their business.

The buyer may predict a business slowdown over the next six months and attempt to structure a deal based around continued pre-coronavirus earnings during that period, which may result in that earnout being unachievable.

The seller needs to be clear about what a realistic prospect for future trading is (allied to their own ability to influence that trading post-sale) with clauses in the sales agreement reflecting that reality.

Selling might be the only option for some business owners but they must exercise caution. The pandemic has created market conditions where speculators feel they can grab bargains, but sellers can still structure any agreement to ensure the business they have worked hard to build is not undervalued.

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Adam Pike is a Senior Associate Solicitor and member of the Ansons dispute resolution team

The coronavirus story changes by the day. After the initial shock of the lockdown, people are analysing the support offered to help the UK economy recover from this difficult period.

The headline measure for landlords and tenants was contained in the Coronavirus Act 2020, which came into force on 26th March.


Currently in place until 30 June, this act introduced a moratorium on forfeiture of commercial leases due to non-payment of rent in a bid to deal with the issue of commercial rent arrears. However, there is strong evidence to suggest the measures will be extended past the original June deadline.

Many commercial tenants have praised the move, saying that it offers them breathing space to take stock and come to terms with the changes that have been made.

However, the measures were not as extensive as some tenants will have hoped. Rent is still payable during this period of moratorium, and landlords can rely on other enforcement measures to recover payment.


In the rush to protect tenants, landlords have been placed in a difficult position for which they could never have prepared. For many, a large part of their rental income has vanished in the space of a month, and measures like the Coronavirus Act 2020 have limited the number of available remedies.

Commercial landlords, at time of writing, have not been granted the kind of loan repayment holiday offered to other sectors of the business world. There is a significant chance that large numbers of landlords will face insolvency in the next few months and beyond.

The questions to consider are what insolvency means for the landlord and for any tenants who thus far have managed to keep their business operating.



In the first instance most landlords will probably opt for a Creditor’s Voluntary Arrangement (CVA) rather than full-scale liquidation. This will take the form of an agreement between the landlord and any creditors and can be entered into as long as 75% of those creditors agree.

Any tenant of a landlord taking this course of action will not be involved in the process itself (being a debtor rather than creditor) and will only discover it has happened after the event.

The impact a landlord CVA might have on a tenant is difficult to predict, but under the supervision of an insolvency practitioner, it is likely that the attitude of the landlord towards their tenant will harden somewhat in respect to lease obligations being met in full and on time.

As such, the kind of flexibility needed for the negotiations between a landlord and tenant in the current climate are likely to be absent once a CVA has been put in place.

If a landlord enters into administration rather than opting for a CVA, the impact on a landlord and tenant is likely to be reduced. As the administration will be attempting to rescue the landlord company, the administrator will work closely with existing management, which should ensure that existing lines of communication continue to operate as before.

Administration will usually cover the whole of the landlord’s business and all properties let. There are more complex circumstances however, which can arise from a landlord holding a number of profitable properties, and some which are not. Loss-making properties could pull the otherwise profitable business into insolvency, a risk which is intensified during the current coronavirus crisis.

The solution is often pre-pack administration, which sees the profitable element of the business sold off to form a new company, and the loss-making aspects becoming part of a CVA.

A tenant of the profit-making element of the business will take the new company as their landlord, which will often involve working with the management and admin team of the original company.

The new landlord company will not be able to vary any of the obligations under the existing lease. If, however, there is new management as part of the new landlord company, they may well take a more hard-line approach to negotiating lease renewals, rent reviews, end of term dilapidations, etc. with a view of maximising income for the new company.



However the scenario unfolds, it is in the interests of both tenants and landlords to keep lines of communication open and remain transparent throughout.

Beyond the pandemic, it is to nobody’s advantage if either landlords or tenants find themselves being forced out of business rather than being able to weather this storm.

If you have any concerns relating to insolvency, or a landlord and tenant dispute, it is important to consult an experienced team of lawyers who can help you achieve the best possible outcome.

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