Vertu Motors, the only car dealership group listed on the London Stock Exchange, has reported a strong first half of the fiscal year, driven in large part by the rising popularity of Chinese car brands in the UK market. The company announced a nearly 20% increase in pre-tax profits to £23.8 million for the six months ending August 31, on a modest 3% sales growth to £2.59 billion. This marks the third profit upgrade from Vertu this year, with the group now projecting to exceed analysts’ expectations once again.

Vertu’s chief executive, Robert Forrester, who founded the company two decades ago, highlighted that the new car market in the UK is performing well despite broader indications of subdued consumer spending. The recent surge in registrations, which climbed by 10% in the first nine months of the year, has been propelled by the expanding footprint of Chinese vehicle imports, a segment that now accounts for nearly one quarter of new UK car registrations.

Key Chinese players such as Chery, BYD, and MG have established a significant presence, with Chery’s brands — including Jaecoo and Omoda — capturing 9.2% of UK registrations in the crucial September number plate change period. This makes the group the second-largest automotive force in the country, trailing only behind Volkswagen and its affiliated marques Audi and Skoda. BYD and MG have also outperformed traditional British and European manufacturers such as Ford, Vauxhall, Toyota, BMW, and Mercedes-Benz, as well as the electric vehicle leader Tesla.

The appeal of Chinese vehicles lies in their diverse powertrain offerings, including petrol, hybrid, plug-in hybrid, and battery electric models, combined with competitive pricing well below equivalent European brands. Unlike the European Union, the UK has not imposed tariffs or trade sanctions on these imports, contributing to their market success.

Vertu stated that the introduction of Chinese brands is reshaping the UK new car market by attracting buyers who previously relied on used vehicles, supported by prices, discounts, and financing deals that make new cars affordable or even cheaper than used alternatives. Reflecting this trend, Vertu has doubled its dedicated Chinese brand dealership network to 18 locations and aims to increase this to 31 within the next year.

Forrester acknowledged that despite the expansion, Vertu remains cautious due to the relative novelty of these Chinese brands in the UK. Nonetheless, the rapid uptake has prompted a reassessment of market expectations. Analysts had initially forecasted Vertu’s full-year profits to be as low as £23 million, but with the company surpassing this figure in just six months, these estimates are likely to be revised upwards, with some projections already considering a £27 million profit for the year.

Vertu’s shares reacted positively to the announcement, closing up 4.4% at 84.75 pence, underscoring investor confidence in the company’s strategic pivot towards the growing Chinese automobile segment and the broader revival of the UK new car market.