A car dealer is a car dealer, and they know how to look after their own interests at the expense of the customer and the shareholder 
Judging by the story, they still donât even know how to be ashamed. At least sometimes Iâve managed to avoid these expansion-crazed companies that drive straight into walls with high beams on, disregarding all risks. There is no law or sense of decency to intervene in these maneuvers by the main owners. Unfortunately, there is more corruption than the studies lead us to believe.
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Wetteriâs CEO Pietu Parikka was interviewed by Thomas regarding Q1
Topics:
(00:00) Introduction
(00:11) Q1 performance
(00:58) Impact of external shocks on demand
(02:23) Passenger car sales
(04:43) New orders on the rise
(04:54) Demand for electric vehicles
(05:49) New key figure
(07:54) Development of maintenance services
(09:19) Market changes in maintenance services
(10:42) Heavy equipment
(11:28) Guidance reiterated
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Here is Juho Torattiâs analysis of Wetteri
At the core of the strategy updated by Wetteri last November is an increasing focus on the passenger car business. The company has been shifting its focus toward passenger cars for over a year by divesting parts of its Heavy Equipment segmentâs operations. With the proceeds from these corporate transactions, Wetteri has strengthened its equity ratio and enabled new growth investments directed at the passenger car and maintenance business. The most recent of these is the acquisition of the maintenance operations of Sports Car Center Airport Helsinki in April.
As the strategic focus has shifted more strongly toward passenger cars, Wetteriâs investors are following the development of the Passenger Cars segment more closely. The JanuaryâMarch interim report, and especially the managementâs confident words regarding the turnaround in the passenger car business, were likely more important information for investors than the reported figures, which were weaker than the comparison quarter.
Note
IR-monitoring is a channel by SalkunRakentaja and Sijoittaja.fi for corporate partnersâ background and analytical articles, as well as other interesting investor information. The article is part of a commercial partnership with the company. The article does not contain investment recommendations.
Here is Thomasâs analysis of Wetteri based on the Q1 results
Wetteriâs Q1 profitability fell clearly short of our expectations, but the order backlog, which strengthened during the quarter, slightly balanced the overall picture of the report. However, the guidance for the current year leaves a lot of catching up to do for the remainder of the year. Based on our forecasts for the coming years, the stockâs valuation is expensive, but due to the businessâs low margin profile and low revenue-based valuation, earnings-based multiples react sensitively to even small improvements in profitability. We reiterate our reduce recommendation and target price of EUR 0.16.
Quoted from the report:
Balance sheet position remains tight
At the end of Q1, Wetteri had a total of EUR 83 million in net debt, which is at a very high level of 9.4x compared to the companyâs comparable EBITDA over the previous 12 months. However, a significant portion of the debt is related to credit limits for car inventory (EUR 30 million) and lease liabilities (EUR 35 million), which are generally easier to reduce than bank loans. Nevertheless, the companyâs financing agreements include covenant terms tied to the net debt/EBITDA ratio and equity ratio. The tightening of these terms over time will force Wetteri to strengthen its balance sheet in the coming years.
CEOâs review from this weekâs Annual General Meeting:
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Here is a stock exchange release from Wetteri.
Inside information: Aarne Simula has been appointed CEO of Wetteri Plc and Mika Aho as Chairman of the Board
The Board of Directors of Wetteri Plc has on 24 June 2026 appointed Aarne Simula as the Groupâs CEO. In the same context, the Board elected Mika Aho from among its members as Chairman of the Board.
After stepping down from the position of CEO of Wetteri Plc on 1 August 2025, Simula continued as a member of the companyâs Board of Directors, an advisor to the management, and the largest shareholder. He now returns as CEO to lead the companyâs phase towards profitable growth, driven by new car sales. Simula will start in the position immediately and continue as a member of the Board.
Aarne Simula has over 40 years of experience in the automotive industry, ranging from sales manager roles to regional management and CEO positions, as well as numerous positions of trust in the industry, including a current membership on the board of the Association of Automobile Industry (Autoalan Keskusliitto).
âThe volume of the car trade is growing, and Wetteri sells the best brands in the country through a nationwide sales network. We are now directing resources towards increasing the sales of new cars, which will provide us with a high volume of trade-in cars for the used car business. We are also seeking growth through industry consolidation, in which we are strongly involved. At the same time, we are intensifying measures to improve the companyâs results. With these elements, we will accelerate the implementation of the âOhittamatonâ (Unstoppable) strategy,â says Aarne Simula.
Mika Aho, the new Chairman of Wetteri Plc, has 25 years of experience in executive roles within the financial sector, including positions as head of business units, insurance services, customer relations director, and deputy CEO. In these roles, he has developed an extensive network of automotive industry operators and an understanding of the industryâs key stakeholders.
Aho commented on Simulaâs appointment as CEO: âDuring his long career, Aarne has accumulated an exceptionally strong and broad understanding of the car trade and the strengths of Wetteriâs business. He has also built strategically important principal relationships for the company over the long term, the significance of which is emphasized during the industryâs transition. The Board is confident that under Aarneâs leadership, the implementation of Wetteriâs strategy for profitable growth will be enhanced.â
Aarne Simula has announced that he will begin drawing a salary for his work as CEO starting from 1 August 2027. The Board has approved this.
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Simula essentially walked away with two yearsâ worth of salary (= severance pay) just to go on vacation for less than a year and now return to the position. The way that companyâs mess is draining shareholder wealth is truly something else.
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I was about to write something similar. This isnât exactly a Summa-level disaster, but from an outsiderâs perspective, itâs absolutely shocking chaos. Well, I bet the consultants are laughing all the way to the bank, getting to do strategy updates for the company less than a year apartâŠ
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When a company has strong leadership (meaning usually on the board and/or a former CEO and/or a major owner), they typically donât have the patience to watch for long if the new management fails to achieve the desired results (cf. Kamux, Robit, etc.). When the previous CEO joined and was interviewed alongside Simula, the new CEOâs comments were, to say the least, dismissive of previous leaders, so itâs no wonder if Simulaâs eyebrows were raised. Apparently, the progress wasnât satisfactory, and the old âconclaveâ is returning to the helm, similar to Kamux. Iâm not taking a stand on whether the old managementâs track record is any better or how the new management has succeeded. SAKA is pulling further and further away, so something had to be done.
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Wetteri announced that Aarne Simula is returning as CEO and Pietu Parikka has been dismissed. The decision was correct, albeit overdue. Parikkaâs tenure as CEO will go down in history as a peculiar performance. Wetteri possesses the countryâs most extensive sales network and dealerships that many competitors eye with envy, and the sale of new cars automatically generates a flow of used cars. This is the basic logic of the industry that every car trade professional knows. Yet, during Parikkaâs time, this very strength was not utilizedâthe strength was seen as a weakness, and resources were directed where Wetteri has no particular competitive advantage. Conversely, weaknesses were seen as strengths.
How is such strategic blindness possible? That is a question shareholders deserve an answer to. A forced smile is no substitute for industry knowledge and professional skill; that is a fact.
Simula identifies the situation clearlyâthe volume of new cars is growing, it produces used cars, and that creates a profitable cycle. Itâs not rocket science, just car trading. Over 40 years of experience shows that the fundamentals are well understood.
Hopefully, Parikka did not manage to cause irreversible damage, as has been seen in his previous roles. Strategic errors are not always fixed by a mere change of leadership, and there may be traces left in principal relationships, personnel, and margins that will only become apparent later.
Wetteri has the prerequisites to turn things around, as long as they now know how to use them.
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I donât quite buy the idea that new car sales are automatically the most profitable part of the business. In recent years, new car sales have been very low-margin or even loss-making for many operators as volume has been sought at any cost.
For example, Auto Bassadoneâs revenue in 2025 was approximately 196 million euros, yet the result remained around five million euros in the red. Even the EBITDA was over two percent negative, so the situation cannot be explained by write-offs alone. Furthermore, the same groupâs import company, Auto-Bon, posted an even weaker result: revenue totaled 124 million euros, but the loss deepened to over 10 million euros.
LĂ€nsiauto, on the other hand, managed to improve its profitability by giving up new car sales and focusing on maintenance services and the used car trade.
The flow of trade-in vehicles is certainly valuable, but if new cars are sold with practically zero margin or even at a loss, volume alone does not create shareholder value. What matters is the profitability of the entire value chain, not the number of new car registrations.
Additionally, chains that sell both new and used cars often face a structural problem. When new car salespeople are put in charge of selling used cars, it is difficult for them to shift from a mindset based on unit sales to one based on margin sales. If a new car salesperson is also allowed to price the trade-in vehicle themselves, they might not even inspect the car on-site; instead, pricing is done solely based on Nettiauto listings. Subsequently, the executive team wonders about high after-costs and weak profitability.
In the used car trade, sales management and the expertise of the sales staff play a decisive role in whether the business is profitable or not. As far as I know, there isnât a single person in Wetteriâs management team with a strong background in the used car trade.
As for the comprehensive sales network, it also means high fixed costs. In my opinion, the network still contains too many small locations whose profitability is questionable.
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Selling new cars isnât automatically the most profitable segment, but it provides excellent trade-in cars for resale. The used car purchase market has overheated and there are no more quick wins thereâthat era was ten years ago. Now is the time to focus on core operations.
Bassadone is a poor point of comparison. They have very challenging brands, and their expertise in the used car business is not on the same level.
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Change in Wetteriâs Management Team: Business Area Director Mika Pokka leaves the company.
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In a previous Wetteri presentation video, Simula himself showed internal company data on how the company makes money, if it makes it at all. New cars are sold at almost zero margin (considering sales costs). However, accessories are sold and installed on these new cars, and usually, a multi-year service contract is secured. These latter components, especially the service operations, are the high-margin parts where Wetteri makes its profit.
Additionally, used cars are acquired through the same process. Some of these trade-ins may be good, but they might also have to accept sub-par vehicles just to close the deal. Some customers may only buy a new car if the seller agrees to take their old junk in exchange. This trade-in car might then have to be dumped to a small-time dealer (jobbari) or through an auction without a right of return at a nominal price.
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Kasperi has given his comments on Wetteriâs plans to streamline its retail network.
Wetteri announced on Friday that it is optimizing its retail network by closing the Raisio used car dealership and relocating the operations of the Vantaa Petikko used car dealership to the new Wetteri Airport location. According to the company, it wants to prioritize facilities that will also allow for new car brand representation in the future. In the same context, Wetteriâs office on Ăyritie will be closed, and the personnel working there will move to the Airport premises. Based on the announcement, the changes will not lead to staff reductions, but they are expected to have a slightly lowering effect on fixed costs.
Here are Kasperâs comments on Wetteri initiating change negotiations.
Wetteri announced on Monday that it is initiating change negotiations aimed at achieving cost savings of EUR 7.3 million. We consider these measures to be in the right direction, given the companyâs weak earnings performance and tight balance sheet. Since previous efficiency measures proved ineffective, the company must now resort to more drastic measures to promote a turnaround in profitability.
Here are Thomasâs comments on the outcome of Wetteriâs change negotiations.
Wetteri announced on Wednesday that it has concluded the change negotiations initiated in July. As a result of the negotiations, the company will reduce 79 person-years, make 39 significant job description changes, and close two locations. As previously communicated, the measures aim for annual savings of EUR 7.3 million.
I wonder where the most [cuts] came from? At the very least, the procurement team in Oulu has shrunk by a few people.
It feels so crazy that the group trying to buy fresh, profitable stock is being shown the door.
At the same time, fairy tales are being told about how we have the entire chain in our own hands when used cars come in as trade-ins for new ones. This is true, but when the trade-ins for new cars have the same net and gross valueâif you ask ten dealers for an offer on an identical car, the one who pays the most for the trade-in and burns the most on the sale (i.e., sells at net) gets the deal. The question remains: where is the profit margin made in this equation?
This is why efficient purchasing and selling high-margin bought-in cars would be so important. Many new car dealers have, for years, spoken with contempt about how, fortunately, there is buying and used car trading alongside new car sales to cover the losses from new car dealsâŠ
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Here are Thomasâs pre-game thoughts ahead of Wetteriâs Q2 results this Thursday
We expect the companyâs total revenue to have turned to growth from the comparison period, driven by passenger car sales. Regarding earnings, we expect adjusted operating profit to have improved clearly from the comparison period and to have turned slightly positive. In the report, our main focus is on used car margins, the normalization of profitability in the service business, and the progress of the extensive cost-saving measures initiated by the company.