UK car distributor inchcape forecasts weak 2026 organic volume growth

UK's Inchcape flags slower 2026 growth as Asia demand softens, Middle East conflict delays shipping

By Yadarisa Shabong and Simone Lobo

Inchcape's Growth Outlook and Market Challenges

March 3 (Reuters) - British auto distributor Inchcape on Tuesday warned its 2026 volume growth would be at the lower end of targets due to weak Asia demand and said the Middle East conflict could delay some Japan-Europe shipments by a few weeks.

Shares in the company, which helps carmakers ship products in more than 40 markets, dropped 8% in morning trading. 

Shipping Delays and Regional Impact

"We're talking a few weeks longer lead times for certain products, but the vast majority of the products we sell in Europe are manufactured in ...European plants," CEO Duncan Tait told Reuters, stressing that only a "small amount" of products that would normally transit the Suez Canal would face delays.

Latin America Shipments

Most of its shipments to the key Latin America market come directly from India, Japan or China and bypass the Middle East, Tait said, adding the impact from the U.S.-Iran conflict was "very manageable."   

Global Shipping Routes

Several shipping companies have rerouted vessels around Africa, away from the Suez Canal and the Bab el-Mandeb Strait, after U.S. and Israeli strikes on Iran and the closure of the Strait of Hormuz.

Weak Asia Demand for Premium Cars

2026 Growth Forecast

Inchcape expects 2026 organic volume growth at the lower end of its 3% to 5% range, mainly due to weak Asian demand for premium cars as customers cut back spending.   

Consumer Sentiment in Asia

"Consumers (in Asia) were a little disrupted I think as to what was going on in the world," Tait said.

Production Disruptions and Offsetting Factors

Inchcape, which operates in the Americas, Asia Pacific, Europe and Africa, also expects first-half disruptions from production outages at two Japanese automakers retooling plants for electric and hybrid vehicles.

Expected strength in Colombia and Peru, stable European and African markets, and cost cuts should offset weakness in Asia and drive earnings per share growth above 10% this year, Tait said.

Financial Performance and Currency Note

Adjusted operating profit in 2025 dipped 4% to 563 million pounds even as the company acted to boost margins as costs increased due to tariffs.   

($1 = 0.7495 pounds)

(Reporting by Raechel Thankam Job and Simone Lobo in Bengaluru; Editing by Subhranshu Sahu, Sherry Jacob-Phillips and Bernadette Baum)