WITH four out of five used car dealers planning to invest in more used car stock in 2019, it would appear the industry as a whole is pushing hard for growth in 2019.
One in five, meanwhile, are also planning to invest in what they are calling ‘preparation facilities’ where cars can be reconditioned and prepared for sale.
But why is the market seeing such a substantial push? In the UK, and used cars NI, sentiment surrounding Brexit has led to an environment where people are hesitant to spend their hard-earned money.
However, there is surely more to it than that. To put a spotlight on the global market, we’ve highlighted a few trends that analysts have seen taking hold in 2019.
There’s been a steady decline in the amount of brand new cars being sold in the UK, with a fall of 20% in 2018 alone no doubt caused by a number of factors, including the new WLTP test procedure.
The fact of the matter is the moment you drive off the forecourt, your car is worth a lot less, and consumers are so more aware of this fact now. So, all but very wealthy individuals (for whom cost is not an issue) would probably consider a used car over a new car.
Still, reports show an increase in the sale of cars that were built within the last 5 years being bought. So, whilst people are not buying brand new cars, they are at least buying ‘newer’ cars from used dealerships.
The real challenge for used car dealerships in 2019 will be finding not only the right vehicles, but enough to match consumer demand.
More used car buyers than ever before are focusing specifically on premium brands, with those brands now representing around 25% of the entire market. More dealers are turning online for vehicle sourcing opportunities with some even reaching out to more unconventional digital channels such as eBay for bargains they can turn into easy profit.
With both WLTP and economic uncertainty over Brexit, not to mention the negative messages surrounding diesel, there is a great deal of instability in the automotive market in the UK.
However, the outlook for the used car market remains good, with demand rising in the used market, particularly the used car finance market. Indeed, it’s a market that is roughly four times larger than the new car market and it’s only increasing.
Finally, with the weak pound against the euro unlikely to recover any time soon, many European buyers are taking advantage by buying up stock from the UK car dealers willing and able to export their cars.
The other right-hand drive countries (Ireland and Cyprus) are obviously top of the list, but there are also noted increases in interest from Germany, Spain and France.