AM Online

Bad weather prompts switch to online buying

Manheim’s Dealer Dashboard showed that December used car sales figures were pretty dire, undoubtedly affected by the bad weather.

Average sales were down 4.5 units on November to just 6.8 units. With consumer interest fixed squarely on the build-up to Christmas, showroom enquiries slowed, as expected, to 11.3.

Online enquiries held up a little better at 8.3, as the icy conditions persuaded consumers to move their searches online.

John Simpson, managing director of Manheim Retail Services, said 2011 was set to be one of the definitive years in the used car market, with many significant influencing factors.

“Shortages of quality used car stock may keep wholesale values higher,” he said. “But that ever-elusive consumer confidence is likely to take a hit as Government spending cuts lead to increasing unemployment, inflation remains hard to bring down and the subsequent threat of interest rate rises looms nearer.

“In 2011 the pressure on dealers to ensure trading as efficiently as possible is likely to be greater than at any time during this recessionary cycle.

The winners will be those that control operating costs and ensure marketing and sales processes are directly geared to maximising stock turn.”

In the wholesale market, December’s average stock for retail values rose £427 to £7,993, caused by a much younger mix of vehicles coming to market.

Overall, average vehicle age was down 3.48 months to 24.17, and average mileage down by nearly 3,700 miles. This younger, lower-mileage stock mix was evident across most vehicle segments.

The bad weather has not stopped dealers who normally attend auction from buying stock: they have simply turned to online buying facilities instead.

Simulcast attendance doubled, bolstering average first-time auction conversion rates, by 3% to 83%.

The lower value Dealer Part Exchange market remained steady. Average sales values softened by £72 to £2,217 on the back of a small increase in average age of 0.8 months to 90.37 and an increase in average mileage of 474 miles to 76,958.

First time auction conversion rates ended the year at a highly respectable average of 80%.

Mike Pilkington, managing director, Manheim Remarketing, said: “Stock turn and operational efficiency will be as vital as ever in 2011.

The auction disposal route is still the most efficient and transparent means of rapidly cashing out of unwanted part exchanges.

“Moving in to 2011, with a relative stock shortage of 3 year old stock, a hangover from the new car sales collapse of 2008, I expect values to remain relatively steady to strong.

But we must all keep a watchful eye on consumer interest as the Government’s austerity measures start to bite.

 

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.

Comment as guest


Login  /  Register

Comments

No comments have been made yet.