AM Online

The only certainty is uncertainty and uncertainty brings opportunity

Our dealer conference on June 4, which saw a record number of delegates listen to 20 speakers, experts and panellists – itself a record in the event’s five-year history – revealed how our certainties so often provide the best grounds for debate.

 

One of the topics at Autoretailing – AM’s G20 as I like to see it – looked at used car retailing strategies when the market had shown such a lack of consistency towards the end of last year, leaving dealers with little certainty about returns on used car sales, stock levels and the right mix of vehicles to offer.

Speaker Adrian Rushmore, managing editor of Glass’s Guide, said he had not experienced those kind of fluctuations in more than 20 years in the industry.

As dealers grapple with understanding and maximising future used car demands, another market phenomenon is developing to keep the best minds in the industry taxed and analysts talking: scrappage.

As the scheme was announced in the Budget there were doubts aired almost immediately on the lack of take-up of the scheme from the people it was targeting.

“Owners of 10-year-old cars cannot afford to pay the difference between the scrappage contribution and the price of a new car,” was one of the most common warnings.

Another assertion I heard from a dealer was that the scrappage scheme was bringing in “poor people”, who asked if they could pay for the coffee in the dealerships they hadn’t been inside for at least 10 years.

But I’ve also heard from other dealers that, with many scrappage customers, there are no concerns about their finances – they’re “cash rich” and using money lying idle in savings accounts.

The age profile and wishlist of many of these customers either sees them replacing the scrappage car in their family and pushing their older cars ‘down the food chain’, or purchasing with their children in mind.

Chris Hayden, chairman and chief executive of Ford Retail, told me this week: “We can predict nothing of what scrappage will bring to the showroom - we simply have to be prepared for everyone the scheme brings to our showrooms.”

The only certainty is uncertainty and uncertainty brings opportunity.

If you are not a registered user your comment will go to AM for approval before publishing. To avoid this requirement please register or login.

Login to comment

Comments

No comments have been made yet.