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AutoWallis expects strengthening of market position after crisis

AutoWallis Plc. says that it expects the strengthening of its market position and new acquisition opportunities in the post-coronavirus crisis economic environment offering favorable opportunities for the realization of the companyʼs market strategy announced last year.

Zsolt Müllner, Gábor Ormosy, and Gábor Székely of AutoWallis.

In the short run, AutoWallis expects the government’s restrictive measures to have a significant negative effect on the economy. On the other hand, it says that the acquisition opportunities following the crisis could further strengthen the market position of the corporation.

The number of salon visits has only started to decrease in the past week, while the number of orders will probably be affected only later on. A press release by the company expects purchases to only be delayed to a varied extent, especially in the segment of the premium vehicles distributed by the AutoWallis Group members.

The company says that it does experience the negative impact of the slowing car rental business, which is the segment most affected by the temporary relapse in sales and the shutdown of tourism; at the same time, in the sector of after-sales services, the impact is barely noticeable.

Several automotive manufacturers have announced temporary shutdowns, which could result in momentary disruptions in the yet uninterrupted supply chain, but after the restrictive measures are withdrawn, supply chains can also be expected to recover.

Still, according to AutoWallis, the consequences of the measures taken to restrain the coronavirus epidemic will affect not only the car manufacturers, but other actors of the value chain as well. This might have a more unfavorable impact on the smaller, financially less solid actors of the market, and AutoWallis says that it is preparing for carrying out acquisitions when the normal course of business resumes.

The company is planning on a treasury share purchase, so that they can use the thus acquired shares for the future acquisitions.

AutoWallis chairman Zsolt Müllner argued that AutoWallis will come out of the short-term negative impacts of the present situation even stronger, continuing its activity on the Hungarian and the regional markets, as the group, backed by financially-solid main owner Wallis Group, has more than 20 years of experience and a considerable knowledge base in the field of management.

Gábor Ormosy, CEO of AutoWallis, emphasized that the subsidiaries of AutoWallis carry on with their sales and service providing activities within the relevant official regulatory environment, adapting to the market conditions, and doing everything in their power to protect the health of their clients and workers, applying appropriate hygiene practices. Salons are open until 3 p.m., while after-sales services are provided uninterrupted, within regular working hours. 

Ormosy added, "Fully aware of our responsibility, we have introduced several measures for the protection of our clients and employees, including a free door-to-door service as part of our after-sales services, a new tire-changing procedure with no personal contact, as well as the disinfection of both the interior and the exterior of our rental vehicles before each handover."

The members of the group have introduced short-term cost cutbacks, in line with the new situation, where it does not pose any health risks.

According to the press release, AutoWallis Group in itself possesses reserves that can provide for at least 12 months of uninterrupted operation without any additional measures or funding.