Retail-ready stock is becoming ever more in-demand in the post-lockdown used car market, the Vehicle Remarketing Association is reporting.
VRA chair Sam Watkins explained that dealers were trying to make the process of acquiring and retailing stock as straightforward as possible at a time when the ongoing effects of the coronavirus crisis meant that key services such as transportation remained erratic.
She said: “Thanks to the strong sales performance seen by used car retailers following the easing of lockdown, most are now entering back into a cycle of replenishing their stock and generally, nearly all of the important elements of the market are now working as normal.
“However, some difficult issues remain, especially around the movement of vehicles, which are not yet back to usual levels of efficiency. That is introducing sometimes quite lengthy delays into getting a vehicle to a dealer.
“What overall impact does this have? It means that the retailer has less time and a reduced inclination to prepare a car for sale themselves, because that creates further increased time-to-sale.
“In addition, as the digitisation of vehicle retailing expands, especially on used vehicles, clarity on vehicle condition for the consumer is critical in building trust and confidence.
“That’s why there is now a noticeably higher demand for retail-ready stock. It’s all about the fastest possible turnaround and the quickest return on capital.”
Sam added that the trend was leading large organisations disposing of cars such as leasing companies, or even dealers themselves, to investigate using centralised resources to recondition and transport vehicles.
“There is definitely more interest in this area and not just because of the coronavirus crisis. Increased complexity in vehicle technology, such as ADAS, is having an additional impact on dealer appetites to operate reconditioning services in-house.
“It is possible that we are at starting to see a structural shift where an increasing number of dealers see themselves as no longer in the business of bringing vehicles up to a necessary market standard.
“Large-scale vendors of vehicles into the used market sector are realising that they will need to meet this changing need and so are increasingly looking to ensure that as much of their stock falls into the retail-ready category as possible.
“Putting in place processes that satisfy this demand is an obvious step and something that we expect to see it emerge as a major trend over the course of the second half of 2020.”