A NEW contract hire business is to be launched in January next year by the Sytner Group, the luxury car dealership company. As the 20-strong dealership group announced record interim results for the six months to June 30, it was revealed that the Leicester-based company is in final discussions to forge a partnership with a bank to launch the new business.

While the company counts BMW, Mercedes-Benz, Land Rover, Jaguar, Lotus, Audi and Maserati among its franchises and has Chrysler, Honda and Volkswagen dealerships, the new leasing company will write business on all makes.

A combination of economic gloom and Government calls for motorists to drive smaller cars has failed to dent demand for luxury cars with the Sytner Group reporting pre-tax profits up 63% to £3.75 million (1997: £2.3 million) on turnover up 55% at £137.8 million (1997: £88.7 million). With a large proportion of the company's business being corporate, managing director Laurence Vaughan said the move to establish a contract hire company by January 1 was aimed at offering another service to businesses.

He declined to reveal growth aspirations for the new, as yet unnamed, contract hire business, but said: 'I don't think we will compete against the major fleets. We will be targeting small fleets where quality and service is as important as price.' Such sentiments are similar to those of rival dealership group William Jacks which has recently launched its own contract hire subsidiary. Other dealership groups to establish leasing subsidiaries in recent months include DC Cook and Reg Vardy.