Dealers are in a much better place in the latest lockdown than they were back in March when the pandemic hit and showrooms closed for business.
That’s the view of Philip Nothard, insight and strategy director for Cox Automotive who said the experience gained by dealers and the acceleration of digital had a significant impact.
“With the introduction of a second round of national restrictions at the start of November, many retailers were undoubtedly nervous about how this would impact business for the remainder of the year,” he said.
Nothard commented on the fall in used car prices saying the decline was for a large part seasonal and not solely due to the second lockdown.
“While the data shows an easing of used vehicle prices and consumer demand, it’s important to look at these figures in context. Used car prices were already decreasing in October, as was consumer demand, all before any announcement of a second wave of national restrictions was made.
“As it stands, it’s unclear whether restrictions will be extended beyond 2nd December or not. Regardless, the investment in digital retail being made by automotive retailers, and the experience of the first lockdown in spring, has put businesses in a much better place to weather the storm this time round.
“The constraint on vehicle supply has been much discussed over recent months—something that’s unlikely to change anytime soon—and the latest data shows that supply has once again dipped at the start of November.
“Undoubtedly the introduction of a second round of national restrictions has played a part in the drop, but it’s important to remember that a supply dip around this time of year is perfectly normal.
“In the wholesale market, vendors typically ease their auction activity ahead of the new year, but the easing has been compounded this year by reduced demand. Vendors are unsurprisingly cautious about entering vehicles into a weak marketplace.”