Jetcon ramps up staff amid slow recovery
Early signs of re-energised sales at Jetcon Corporation were erased with the emergence of the COVID-19 disease.
The pre-owned car dealer has now descended into losses, but has a game plan to reverse the bleed that includes putting in fewer orders for auto imports while pushing the inventory already sitting on its lots, and offering payment holidays to car buyers.
Jetcon Chairman John Jackson told shareholders of the company at their annual general meeting on Tuesday night that business had been picking up in the first quarter after a bad year. But it didn’t last.
In the June quarter, sales fell 61 per cent year-on-year to $86 million, and the company spun from a profit of $8.7 million to a loss of $6.8 million.
“Last year was a particularly challenging one for Jetcon, and indeed the motor vehicle industry, and it has continued into this year. Initially, things looked promising, but COVID intervened,” Jackson said.
Sales at Jetcon also dipped sharply in March, with the dislocation caused by the shutdown or scaling back of business operations, as well as from curfews.
Managing Director Andrew Jackson, founder of the company and brother to the chairman, said that with high levels of uncertainty about the virus and its health risks, and the lockdowns that caused restrictions on movement and general unease, purchasing cars was not high on the list of people’s priorities.
The high season for sales at Jetcon is July-August and November-December, according to Jackson, who says the company is currently seeing some green shoots, which is projected to hold throughout the rest of the year.
“Things are picking up. Car sales are recovering but still well below normal levels up to August, which signals a slow but steady recovery from COVID-19 lows. We expect that to continue rising over the next few months towards normality,” the managing director said.
To entice customers into its showrooms, Jetcon says purchasers of cars on credit will have 90 days to make the first payment.
The auto trader cut its staff down to 20 during the lockdown, but with the economy reopening since June, its workforce has been returned to its full complement of 30.
Jetcon, for a while, had stopped replenishing its stock while trying to move the build-up on its lots – inventory fell from $525 million to $456 million as a result – but the car dealer is ready to lift its self-imposed import freeze.
“We’ve started buying cars again because we’re running out of some models; so we’re buying those, even if in smaller numbers,” Jackson told the Financial Gleaner.
“All being well, we should end the year on a positive note – not a big profit, but a profit nonetheless,” he said.