PROFILE Peter Vardy: Super salesman without the spiel

Richard Phillips meets a car dealer who is worth pounds 51m but proud to earn a salary of just pounds 46,000

NOT SO long ago, the mention of August was enough to have car dealers slavering at the prospect of another bumper month, as the annual rush to buy new registration cars came round once more. August meant the dealer could afford to live up to his public image of a Flash Harry, cigar in one hand, glass of champagne in the other, driving a top-of-the- range Jag.

No longer. As the bottom fell out of the market, car dealers approached August in a more cautious frame of mind.

Peter Vardy, who runs motor dealer Reg Vardy, fits few, if any, of these stereotypes. For a start, he is looking forward to August.Gloomy forecasts that car sales will barely improve on the 452,000 cars sold last August do not faze him. "For us, the August numbers are coming in very well, on specialist car sales and in our volume franchises," he says. The Mercedes and BMW dealerships especially are where Reg Vardy can clean up, as company man flocks en masse to buy his new N-reg car on 1 August.

Mr Vardy defies convention in other ways. When he took over the business after his father's death in 1976, there was just the one showroom in Stoneygate, on the edge of Sunderland. Its roots were in the pit communities of the North-east, but Mr Vardy took the unusual step of expanding the business into luxury car marques. "I thought, 'If I'm going to sell cars, then I ought to sell the best cars there are'."

At one time, his Sunderland showroom was the world's biggest dealer in Aston Martins - not the sort of car you readily associate withmining villages. The success of this move was, in part, down to the absence of any real local competition. The early Eighties saw a growing class of entrepreneurs, eager to mark their arrival with the purchase of a Ferrari, Rolls-Royce or Aston. The company now has 40 showrooms across the country, including franchises for nearly all the volume car manufacturers.

Nearly-new cars have become an important part of the business, a market Mr Vardy was one of the first to exploit. The collapse of the new-car market in 1989 created this segment. As manufacturers found it increasingly difficult to persuade dealers to stock their models, they asked car rental firms if they would prefer to change their hire cars twice a year, rather than once. Soon it became possible to buy an ex-rental car three months old, with much of the instant depreciation that new buyers suffer removed.

Other than selling expensive cars, and occasionally driving the ubiquitous Jaguar, there is precious little that could be called flash about Mr Vardy. And unlike the Arthur Daleys of this world, he is very rich. His 42 per cent stake in the company is worth pounds 51.07m, on Friday's closing price of 262p a share. The company has come a long way with Mr Vardy, now 48, at the wheel. Reg Vardy's value has risen four-fold since it floated on the Stock Exchange in 1989, when it numbered 18 dealerships. It is now the the 11th largest dealer in the country, according to figures from the Retail Motor Industry Federation.

Last month, it unveiled remarkable full-year figures, announcing a 31 per cent rise in pre-tax profits to a record pounds 11.02m. Shortly after the results, Mr Vardy sold shares in the company for only the second time, when he disposed of 3 million, after the institutions had clamoured for stock.

So how has Reg Vardy managed to grow, right through the longest recession since the Twenties? Britain's motor-car dealers have always been in an unusual position vis-a-vis the manufacturers, who have traditionally called the shots. Manufacturers decide if a dealer is awarded a franchise, and impose strict rules on how the cars can be sold, unlike other retail businesses, where the end seller exerts the influence over its suppliers.

But manufacturers have been impressed by the Vardy approach, not least its commitment to volume selling. Franchises, or "opportunities", as Mr Vardy calls them, soon began to pile up. This year, six new franchises have been added.

The downfall of Octav Botnar, the Nissan king of Britain, was also a stroke of luck. Reg Vardy was appointed a Nissan dealer in 1991, and opened a flagship showroom near Nissan's Sunderland factory. It now has three Nissan dealerships.

Physically imposing - he stands 6ft 4in - Mr Vardy is a man not many would trifle with. He has few detractors. There is a strong City fan club, based on his down-to-earth approach, and a track record of delivering on promises.

He is proud that his annual salary is just pounds 46,000. Of course, he is compensated by his dividend, which topped pounds 1m last year. But he says the money from the dividend goes to a charitable foundation: "I have never wanted to live the high life, so I don't need the money."

Mention of the shenanigans of the Greenbury Committee draws a rueful response, and a faint bewilderment that such confusion ever arose. He is angry with the committee's original recommendation. When Reg Vardy was floated at 90p in 1989, it was a chance for staff, not just institutions, to buy into the company, he says. He feels the Government let down managers with small share option packages. "The news that our managers would be taxed on their gains gave rise to a lot of ill-feeling," he says.

If he has been disappointed by the Government's current performance, he hides it well. "The time of Margaret Thatcher created an environment where small businesses could flourish, and we did" is his only hint that things might be better managed nowadays.

As Mr Vardy's wealth has grown, so has his influence. He has struck up a close friendship with Sir John Hall, the moving force behind the remarkable resurgence of Newcastle United football club and the Gateshead Metro shopping centre. Like Sir John, his outlook is tinged by idealism, inspired perhaps by his religious faith - he still plays piano at the evangelical Bethany Church, which his father attended. With Sir John, he struck a sponsorship arrangement with Newcastle United. It was probably this that prompted stories that he was poised to emulate Sir John and step in as saviour of the club on his own doorstep, ailing Sunderland. But he says he has never had time to develop an interest in much outside work.

As a schoolboy, Mr Vardy went to Durham Choristers and then Durham School, leaving at 16 with one O-level in music. Perhaps it is his regret at lacking qualifications that his charitable interests are focused on education. He helped found Emmanuel College, a City Technical College in Sunderlandwhich now teaches some 900 children, two-thirds of them from deprived backgrounds. Local response to his involvement was hostile initially. "I was pretty battle-scarred after the first few months, but it only made me more determined to see the thing through."

While the response to the CTC concept nationally has veered from yawning indifference to condemnation, Emmanuel's exam results make it one of the best CTCs in the country.

There is one more reason why Mr Vardy is unlike other car dealers. He didn't try to sell me a car.

Start your day with The Independent, sign up for daily news emails
PROMOTED VIDEO
Arts and Entertainment
Kara Tointon and Jeremy Piven star in Mr Selfridge
tvActress Kara Tointon on what to expect from Series 3
Voices
Winston Churchill, then prime minister, outside No 10 in June 1943
voicesA C Benson called him 'a horrid little fellow', George Orwell would have shot him, but what a giant he seems now, says DJ Taylor
News
i100
Sport
footballBrighton vs Arsenal match report
Arts and Entertainment
Benedict Cumberbatch has spoken about the lack of opportunities for black British actors in the UK
film
News
ebooks
ebooksA year of political gossip, levity and intrigue from the sharpest pen in Westminster
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Tax Assistant

Negotiable: Recruitment Genius: A Tax Assistant is required to join a leading ...

Recruitment Genius: Outbound Sales Executive - OTE £25,000

£16000 - £25000 per annum: Recruitment Genius: This is an exciting opportunity...

Ashdown Group: Java Developer / J2EE Developer - Watford - £45,000 - £47,000

£45000 - £47000 per annum + bonus + benefits: Ashdown Group: Java Developer / ...

Ashdown Group: Marketing Product Manager - (Financial Services) - SW London

£35000 - £38000 per annum + Benefits: Ashdown Group: Marketing Manager - Marke...

Day In a Page

Iraq invasion 2003: The bloody warnings six wise men gave to Tony Blair as he prepared to launch poorly planned campaign

What the six wise men told Tony Blair

Months before the invasion of Iraq in 2003, experts sought to warn the PM about his plans. Here, four of them recall that day
25 years of The Independent on Sunday: The stories, the writers and the changes over the last quarter of a century

25 years of The Independent on Sunday

The stories, the writers and the changes over the last quarter of a century
Homeless Veterans appeal: 'Really caring is a dangerous emotion in this kind of work'

Homeless Veterans appeal

As head of The Soldiers' Charity, Martin Rutledge has to temper compassion with realism. He tells Chris Green how his Army career prepared him
Wu-Tang Clan and The Sexual Objects offer fans a chance to own the only copies of their latest albums

Smash hit go under the hammer

It's nice to pick up a new record once in a while, but the purchasers of two latest releases can go a step further - by buying the only copy
Geeks who rocked the world: Documentary looks back at origins of the computer-games industry

The geeks who rocked the world

A new documentary looks back at origins of the computer-games industry
Belle & Sebastian interview: Stuart Murdoch reveals how the band is taking a new direction

Belle & Sebastian is taking a new direction

Twenty years ago, Belle & Sebastian was a fey indie band from Glasgow. It still is – except today, as prime mover Stuart Murdoch admits, it has a global cult following, from Hollywood to South Korea
America: Land of the free, home of the political dynasty

America: Land of the free, home of the political dynasty

These days in the US things are pretty much stuck where they are, both in politics and society at large, says Rupert Cornwell
A graphic history of US civil rights – in comic book form

A graphic history of US civil rights – in comic book form

A veteran of the Fifties campaigns is inspiring a new generation of activists
Winston Churchill: the enigma of a British hero

Winston Churchill: the enigma of a British hero

A C Benson called him 'a horrid little fellow', George Orwell would have shot him, but what a giant he seems now, says DJ Taylor
Growing mussels: Precious freshwater shellfish are thriving in a unique green project

Growing mussels

Precious freshwater shellfish are thriving in a unique green project
Diana Krall: The jazz singer on being friends with Elton John, outer space and skiing in Dubai

Diana Krall interview

The jazz singer on being friends with Elton John, outer space and skiing in Dubai
Pinstriped for action: A glimpse of what the very rich man will be wearing this winter

Pinstriped for action

A glimpse of what the very rich man will be wearing this winter
Russell T Davies & Ben Cook: 'Our friendship flourished online. You can share some very revelatory moments at four in the morning…'

Russell T Davies & Ben Cook: How we met

'Our friendship flourished online. You can share some very revelatory moments at four in the morning…'
Bill Granger recipes: Our chef serves up his favourite Japanese dishes

Bill Granger's Japanese recipes

Stock up on mirin, soy and miso and you have the makings of everyday Japanese cuisine
Michael Calvin: How we need more Eric Cantonas to knock some sense into us

Michael Calvin's Last Word

How we need more Eric Cantonas to knock some sense into us