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Car Dealer Live & Podcasts
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NEWS AND THOUGHTS FROM SOME OF OUR CAR DEALER LIVE GUESTS
CAP HPI
December values drop was business as usual
USED car values slipped again in December but there’s no price crash on the horizon, said Cap HPI’s head of valuations. Derren Martin exclusively revealed that used car values fell by 1.4 per cent that month but it was a normal drop.
‘Values during December on our Live products fell by 1.4 per cent, which is around £240,’ he said.
Some car dealers went on social media to predict a used car price crash over the Christmas period. But Martin said: ‘The important thing to note is that a drop like this is normal for this time of year – this isn’t a crash.’
He added that since Cap HPI introduced its Live product in 2012, the average December drop was 1.4 per cent, so it was in line.
‘The difference this December is that the fall is coming from a much higher starting point,’ he said. ‘It hasn’t knocked much off the overall increases – values are still over 27 per cent up on where they were at the start of the year.’
Martin went on to say that December’s fall, as in other years, was because of retail demand dropping, but also September and October saw the large dealer groups stocking up for January.
‘There’s also a lot of people who have been watching and waiting to see what happens to values. When you’re watching and not buying, there’s little competition.’
Two of the strongest sectors in December remained city cars and MPVs, but only by small amounts – around three per cent or £150 for the Fiat Panda, Kia Picanto and Skoda Citigo.
Martin reckoned this was due to MPVs still representing good value while city cars were still a necessity purchase for many.
Looking back on a ‘crazy’ year for used car valuations, Martin said: ‘It’s never been more difficult to forecast values of cars – it’s actually easier to predict what’s going to happen in three years’ time, as we know there will be a lot less volume because of what’s happening right now.
‘With semiconductor shortages, Omicron and the potential for Covid outbreak at factories, there is not going to be many new cars coming through, and obviously that will mean fewer used cars being generated.
‘We think values will stay strong into 2022.’
PODCAST
Driven by
CELEBRATION
Teams battle it out to claim Quiz of the Year crown
TO CELEBRATE the end of another weird and wonderful year, the Car Dealer Podcast did things differently for a special episode.
Instead of a show looking back at the week, this time we put the Car Dealer team and two dealer guests’ knowledge of the year to the test.
In this podcast episode – that can be played on Apple Podcasts or Spotify AND watched on YouTube – James Baggott teamed up with Swansway director Peter Smyth, left, while James Batchelor chose Car Quay boss Jamie Caple, right, as his teammate.
With Rebecca Chaplin as quiz master, the teams went through five rounds of news challenges to decide who would be crowned the winner of the Car Dealer Quiz of the Year. Watch now to find out who really knew the most about car dealerships and the automotive industry in 2021. Click on the image to see how the teams got on.
AUTO TRADER Watch our Car Dealer Live broadcasts as they go out or catch up on any that you’ve missed at:
cardealermagazine.co.uk/live
Catherine Faiers
Chief operating officer, Auto Trader
There’s more confidence about buying online
DESPITE the government announcing Plan B and rumours of even further restrictions in December, the used car market was ending the year in strong health, said Catherine Faiers, Auto Trader’s chief operating officer.
‘We’re seeing levels of consumer demand continuing to increase on our platform,’ she said.
‘And equally, we’re seeing the value consumers place on car ownership and having access to a car, again, is at record levels, because of all the concerns out there around the latest variant.’
Faiers explained that in the week commencing December 4, Auto Trader numbers were up by around 20 per cent on 2019, while for the week commencing
December 20, numbers were up by 23 per cent. There were plenty of great highs for car dealers in 2021 too, she said. ‘Dealers have traded surprisingly well during the lockdowns. If you had asked us in 2019 what kind of sales volumes retailers would be able to support and deliver if forecourts weren’t widely open for retailing, I don’t think anyone would have said they’d be 84 per cent of typical volumes in the third lockdown.
‘So, I think for the next few weeks and months, wherever they take us, retailers should feel confident, be getting on the front foot and taking the opportunities there’ll be in the market.’
She added: ‘Overall, online sales in the UK for all categories jumped from about 18 per cent prior to the pandemic to about 26 per cent in Q3 of this year [2021] – and in Q3 this year, you’ll remember, we were about six months out the other side of the last lockdown,’ she said.
‘We’ve definitely seen that play through into automotive, with many of those traditional barriers – whether it was the test drive or completing the finance application on the forecourt – being broken down. All of those factors are giving consumers confidence to do more of the buying journey online.’
But when asked if sourcing stock will get easier in 2022, Faiers said there wouldn’t be much good news on that front. ‘2022 will be the third year in a row where we’ve seen relatively low levels of new car transactions by historic standards, and that is going to have an impact on vehicle availability.
‘By 2024, there’ll be a third fewer three-to-five year-old vehicles than we would have seen in 2019. So, there’ll be about 2.9m vehicles in that age cohort, compared to the 4.8m or so in 2019.’
LAWGISTICS
Commission disclosure has been like the new PPI
CAR dealers faced new legal challenges in 2021 following an FCA report on commission, said Lawgistics managing director Joel Combes.
‘Commission disclosures have been coming in faster than we thought.
‘I know we talked about this at the beginning of the year and how we thought this would happen, but there was a report by the FCA about non-compliance and requirements of a disclosure agreement. That sparked off a few letters coming in, and now we’ve actually taken someone on who deals with the financial side for us.
‘The solicitors have got on to this because it’s like the new PPI.’ He explained that in their terms and conditions, car dealers should have said that if people asked for details of commission they would be given it, and in the FCA report it has said this needs to be prominent.
‘Solicitors jumped on that and said dealers have been misleading because they haven’t made it prominent,’ he said. ‘So really there is no news here because they were doing it properly, but they haven’t brought it to the forefront of their terms and conditions.
‘That’s the letters we’re getting in. They’re really chancers.’
