How has the used vehicle arena managed, reacted to and evolved over the global pandemic?
It sometimes takes a significant event to provoke change, and it’s certainly fair to describe the Covid-19 crisis as such, and likewise the long-lasting effect it has had on the remarketing sector is huge.
Much like the wider world, there has been an overnight rush to digitise and move business online, in a way that is likely to leave a legacy of modernisation when Covid is long gone from the headlines.
Market leader BCA has been invoking a major digital revolution since March, “transforming a physical auction business to an entirely digital selling proposition,” the firm tells Company Car Today.
Aston Barclay is another that has shifted digitally, although buyers can view stock prior to the sale by appointment. “Within a week of lockdown we had made some tweaks to our digital channels and we were selling cars online,” says managing director Martin Potter.
And he predicts the change could be a long-term one. “Aston Barclay is still only offering used vehicles online and until such time as we think it is safe to change, we will stay online only,” Potter continues.
VALUES BOUNCE BACK
After a rough couple of months during lockdown, used values have recovered with impressive resilience.
Cap HPI reports that it witnessed a “dramatic increase in values during June, and then a stabilisation in July and August”. Head of valuations Derren Martin says that values have peaked, but remain high for now.
“It’s clear that strong demand and a shortage of supply are helping to drive up used values,” he says.
Martin says it’s hard to judge where values are heading. “The car industry and the country have never been in a situation like this before. It is more important than ever to track used car values,” Martin continues.
BCA’s monthly average sold value tracks the lockdown and bounceback, with prices stabilising in July after steep rises in the previous two months from lockdown levels.
OPEN AND (MAINLY SHUT) CASE
At present, very few auction sites allow buyers to attend physical auctions, although Shoreham Vehicle Auctions recently held its first sale with only trade buyers present.
Cap HPI’s Derren Martin says: “The vast majority of auction sales remain virtual-only. Some have opened carefully for viewing only, and a minority do have cars being driven through the halls. The larger ones remain completely online.
“As the volume of cars sold illustrates, the industry has adapted to the new normal, and it remains to be seen when, and to what degree, auctions will reopen their doors.”
Aston Barclay managing director Martin Potter says: “In the future, auctions may only see physical buyers in attendance at the budget end of the market.”
He adds that the quality of graded inspection reports and imagery has led to “huge trust” from buyers. “The industry has been modernised by Covid,” he believes.
BCA COO UK Remarketing Stuart Pearson on how the company has navigated the past few months
1.Quick reaction to adapt ways of working
BCA developed new ways of working together with our people, suppliers, partners and customers that comply with safety legislation and Government guidance. Within a few days, we had adapted our Live Online and Virtual Sale technology to begin offering vehicles online with socially distanced auctioneers controlling competitive real-time bidding.
2. Digital developments
BCA introduced a number of enhancements to the website aimed at developing functionality for the new digital buyer audience, including improvements to the digital sales catalogue and enhancing the wider user experience.
3. Momentum returned by the summer
We had up to 1500 buyers logging in for some individual sales, underlining the appetite that the market has for the stock. In addition, the activity through our fixed-price BCA Buy Now and BCA Bid Now timed auctions has significantly accelerated from the period prior to lockdown, with many customers having the confidence to purchase through these channels for the first time.
4. Actions at both ends of the market.
There is continued interest in higher value, retail-ready vehicles and we are running weekly Top Car sales featuring prestige, luxury and sporting marques, reflecting demand from our buyers. Demand for lower-value vehicles remains buoyant, maintaining the trend we have seen since the first days of lockdown and resulting in some unprecedented price increases.