Automotive insolvencies drop in August
Nottingham, 4 October 2010 — The rate of business insolvencies [1] for the automotive industry fell from 0.09 per cent in August 2009 to 0.07 per cent in August 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 0.10 per cent in July to 0.07 per cent in August.
The financial strength2 of the automotive industry also saw a slight improvement both year-on-year and month-on-month, going up to 80.08 from 79.71 in August 2009 and from 79.90 in July 2010.
However, automotive businesses saw a slight increase in late payment with automotive businesses paying their bills 16.62 days after agreed terms in August last year, rising to 17.37 days late in August this year. As a result the automotive industry has fallen from 6th place to the12th place as the fastest paying industry, representing a significant drop in performance.
Joe Myers, Director of Commercial for Experian Business Information, said: “ “The improvement in the rate of insolvencies and the financial strength of the automotive industry is encouraging and completely in-line with the UK average. Key to this is the industry keeping within payment terms. Improvements to this will improve the sector’s financial score and, in turn, credit limits which continue to be crucial to the survival of a business.”
Insolvency rate |
August-10 |
August-09 |
July-109 |
Automotive |
0.07% |
0.09% |
0.10% |
All sectors |
0.07% |
0.09% |
0.08% |
Source: pH, an Experian company
Insolvencies |
August-10 |
August-09 |
% Change from 09 |
July-10 |
Automotive |
26 |
31 |
-16.1 |
35 |
All sectors |
1,391 |
1,783 |
-22.0 |
1,542 |
Source: pH, an Experian company
Financial Strength Score |
August-10 |
August-09 |
% Change from 09 |
July-10 |
Automotive |
80.08 |
79.71 |
0.5 |
79.90 |
All sectors |
81.06 |
80.79 |
0.3 |
80.93 |
Source: pH, an Experian company
Days Beyond Term |
August-10 |
August-09 |
% Change from 09 |
July-10 |
Automotive |
17.37 |
16.62 |
4.5 |
16.75 |
All sectors |
23.03 |
23.61 |
-2.5 |
21.10 |
Source: pH, an Experian company
Natalie Hale
0115 992 2645/07971 709 274
About Experian
Experian is the leading global information services company, providing data and analytical tools to clients in more than 90 countries. The company helps businesses to manage credit risk, prevent fraud, target marketing offers and automate decision making. Experian also helps individuals to check their credit report and credit score, and protect against identity theft.
Experian plc is listed on the London Stock Exchange (EXPN) and is a constituent of the FTSE 100 index. Total revenue for the year ended 31 March 2010 was $3.9 billion. Experian employs approximately 15,000 people in 40 countries and has its corporate headquarters in Dublin, Ireland, with operational headquarters in Nottingham, UK; Costa Mesa, California; and São Paulo, Brazil.
For more information, visit http://www.experianplc.com.
[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.