DEALERS are overwhelmingly optimistic about the used car sector in the next 12-18 months, new research for Startline Motor Finance indicates.
Despite a potentially gloomy economic outlook thanks to factors ranging from the prospect of recession to continuing Brexit uncertainty, almost half (47.1%) believe that the market will see growth to some degree.
Meanwhile, nearly a third (29.1%) see the market as unchanging and just over a fifth (22.8%) predict limited negative growth. Tellingly, none (0.0%) of the respondents to the question thought there would be substantial negative growth.
Paul Burgess, CEO at Startline Motor Finance, said: “One of the truisms of the motor industry is that, even when times are difficult, people still need cars to live and to work – and even when new car sales suffer, used sales tend to be resilient.
“To some extent, used cars are a counter-cyclical business and there is every reason to believe that the industry will be very busy over the next couple of years, whether the many possible macroeconomic difficulties materialise or not.
“Dealers clearly share this view but it is perhaps surprising the degree to which they view this is a moment when growth – even substantial growth – is possible. Really, they are overwhelmingly optimistic.”
Burgess added that other recent research by Startline had indicated that dealers were ready to invest in their used car operations, particularly when it came to online finance and sales.
“It is possible that new car sales will fail to recover or even continue to fall in the short-medium term, so putting money into maximising the possibilities of used car sales at this time certainly makes sense.
“From a Startline point of view, we continue to have conversations with dealers about how the kind of flexible motor finance we provide can play a part in their plans heading into 2020 and beyond, and many are rethinking their lending panels are a result.”
This research was carried out by APD Global and surveyed 57 dealer businesses including franchise groups, independents, car supermarkets and online specialist brokers.
The sample was designed to be representative of the dealer sector as a whole. All the respondents were senior managers who had responsibility for used car retailing and finance propositions.