Digital drive continues to gather pace as sectors seek online solutions
The demand for digital solutions is continuing to drive all sectors of the market- that’s the headline news from the latest Cox Automotive Market Overview April monthly report.
In the wholesale market, April’s data crunching has revealed a 20% year on year increase in volumes and a 12% uplift in average sales prices through Dealer Auction – Cox Automotive’s trade-to-trade online platform - showing that the adoption of online bidding is gathering pace.
As the numbers reveal, dealers are increasingly taking up the opportunities offered online with a 56% increase in online activity reported compared to April 2017.
With digital demands continuing to shape the market, digital integration and improving the digital retailing experience to enable car buyers to do more online are becoming increasingly important in providing a competitive edge.
The message is clear:
Dealers must adapt to the challenging environment of evolving technology and ever changing car purchasing expectations or face the risk of being left in the digital slow lane.
Further conclusions for the wholesale sector from the April data show a stable market with online and physical lanes volumes on a par with previous months – repeating the yearly trend identified early in 2018 of an increasing desire for enhanced imagery and ready for retail inventory.
The report also makes an April fool of those predicting the demise of diesel with volumes increasing 7% compared to 2017, while in the retail sector diesel sales have only fallen marginally in comparison to petrol and hybrid vehicles, which are selling at a much slower rate than in 2017.
Electric vehicles continue to surge, with an 18% increase in volumes year-on-year from April 2017 to 2018 and a similar supercharged performance in the retail sector with a significant fall in days in stock – 48 in 2017 to 41 in 2018 – compared with other fuel types in the same period.
If the demand for electric vehicles is increasing so is the demand for smaller, more affordable, low mileage vehicles as they continue to outsell larger, prestige models.
A final reality check for dealers comes from Modix’s research data showing that car buyers are looking a lot closer to home for new vehicles than dealers first thought.
While only 5% of dealers thought car buyers were likely to look within a 20 mile or 50 mile radius, the reality is 12% and 35% respectively –a wake-up call on current car buying habits and expectations.
Overall, April’s results point the way to a more stabilised market, with only just under a third of dealers (30%), predicting a gloomy outlook for the market, while a 61% majority expect economic conditions to remain the same in coming months.