The remarketing sector needs to move to meet the expectations of used car buyers who have had to opt for a nearly-new vehicle rather than new because of stock shortages.
Philip Nothard, chair at the Vehicle Remarketing Association, pointed to a recent What Car? survey that showed 31% of nearly-new buyers had found themselves in this situation because of poor availability.
“We’re in a period where all used car buyers are paying much more for vehicles than they were even a few months ago and, as a result, expectations have understandably shifted in terms of vehicle condition, proposition and overall service.
“However, this situation is most acute at the nearly-new end of the market. People who are paying very close to list price or sometimes even more for a vehicle quite rightly have very high standards. Effectively, they expect the car to present as new.
“What we are seeing is the remarketing sector move to meet this change. New demands are being placed on everything from vehicle reconditioning to delivery services in terms of emulating new vehicle standards.
“Many suppliers are upping their game. Of course, this is making the vehicle sale more expensive but this is being offset by the prices retailers can currently charge.”
Philip said that the situation was unlikely to change in the near future, with new car shortages set to continue well into next year and potentially even much longer.
“There is a strong possibility that we won’t see a return to ‘normal’ supply until 2023-2024 and as a result, all used cars are simply going to stay more expensive than in the recent past for a substantial period of time to come.
“This is going to be a medium-term trend at least for the remarketing sector and we expect to see an ongoing process of development of products and services within the sector to meet its needs.
“In its own way, it is quite an interesting moment for our industry, because it gives us a chance to show exactly what we can do in terms of enabling retailers to meet the very highest level of customer expectation.”
He added that the latest Cox Automotive Insight Report – at https://bit.ly/3ntn7DS – underlined these market trends.