Independent dealers are ‘outpacing’ franchised dealers in terms of sales performance, according to Auto Trader. The used car market has entered H2 with positivity in relation to consumer demand, speed of sale, and transactions.
Consumer confidence rose in June as the global and political backdrop became less turbulent.
Marc Palmer, Head of Strategy and Insights, at Auto Trader, said: “As we enter the second half of the year, our data shows that the fundamentals of the used car market remain strong; consumer demand is robust, and cars are selling at pace, which combined with the overall softening in supply, means retail prices are stable, and continue to follow seasonal norms.
“At a granular level, there is considerable nuance in the market, however, which is impacting retailers’ traditional stock profiles and making the job of finding profitable cars more competitive. It’s why using insights over instincts to power your forecourt strategy is more important than ever.”
Auto Trader’s retail sales data suggests the market grew at a rate of 3.2% year-on-year (YoY).
Whilst the average independent retailer saw a 6.1% increase last month but sales among franchise retailers only increased by 0.1% YoY. This contract is attributed to differing stock profiles, and the variances in supply and demand.
The core used market for franchised dealers has shrunk due to sourcing challenges. The impact of the 3 million new cars not sold during the pandemic continues, shifting from 1-3 year old cars to the 3-5 year old segment.
Some franchised dealers have been stocking older cohorts, selling brands that have grown their market such as Volvo and Kia, in order to minimise the impact of supply challenges.
Auto Trader highlights the fact that independent dealers have been largely unaffected in comparison.