- Car retailer Lookers warned that its profits would take a hit this year amid falling consumer demand for cars and rising costs.

The company downgraded its outlook on underlying profit before tax to be approximately £32m, down from £43m in the comparable period last year.

The company said trading in the second quarter had begun satisfactorily, but proved increasingly more challenging, with registrations down 4.6% in the quarter from a year earlier, Weaker demand and the resulting margin pressure in the used car market had significantly increased, notably during the month of June.

The more challenging market conditions in the first half, particularly in the second quarter, were likely to continue into second half, exacerbated by continued weakness in consumer confidence in light of wider political and economic uncertainty, and further pressure on used car margins, the company said.

'There is also the possibility of new vehicle supply restrictions as new emissions regulations come into force during the third quarter,' Lookers said, adding that retail sector cost inflation experienced in first half was likely to continue to impact earnings during the second half of the year.

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