Used car sales analysis shows gap between asking price and sale price doubles in 12 weeks
The gap between the advertised price of a used car and the actual sale price achieved doubles over a 12 week period, according to research by cap hpi.
The automotive data specialist found that the average difference in the first week a vehicle is advertised is 3.8%, and this rises to 6.4% by week 12.
This follows a recent analysis by accountancy group UHY Hacker Young which showed that car dealers are holding significantly more stocks than they were five years ago.
Philip Nothard, retail and consumer specialist at cap hpi, advised dealers to focus more closely on the cars they source and how they price them to reduce the time vehicles spend on the forecourt.
He said: "With concerns over a more volatile market it is important to make stocking decisions that keep your retail offer flexible. The research shows that sourcing the right vehicle, at the right price for the market, pays dividends.
"The data highlights the importance of understanding your brand, where you sit in the local market, what to sell and when."
A survey of dealers by cap hpi revealed that 48% saw retained margins worsen in July compared with June, while only 19% said they had improved. Nothard argued that making the correct stocking decisions for local conditions is key to maximising margins.
The study also showed that different pricing and stocking strategies are required for different vehicle marques.
Nothard said: "The price sensitivity over time was not always related to volumes available in the market. Premium executive stock showed good price resilience, along with niche marques like Abarth.
It is important to use the most up to date and accurate data when making stocking decisions.