Due to the on-going recession, more and more members of the public are now looking for cheaper options when it comes to investing in the motor industry, meaning that many companies are now offering deals on cars, insurance policies and after-sales care packages in order to increase their sales. Therefore it is not surprising to hear that retail demand for used cars is now at its highest since last September, and motor traders are now trying to stock more second hand vehicles as most customers can no longer afford to buy brand new.
However, it has been reported today that motor traders are finding it difficult to source enough good quality ready to retail vehicles. According to CAP Automotive, the market is being held back due to the fact that there has been a massive drop in the amount of people buying new cars since the beginning of the recession, meaning that there is also less chance of used cars being sold on. Furthermore, the car analyst said that motor traders are becoming more cautious when it comes to stocking new vehicles in their forecourts, so that most are now only eighty per cent full.
Discussing the findings, Derren Martin senior editor of CAP Black Book Live, said: “We are seeing a good buzz around the auction halls, with plenty of appetite from dealers for the best quality stock – when they can find it. Some auction sales have seen conversion rates up to 20% better than during the same period last year and the dealers we speak to are generally happy with the level of retail interest they are seeing. We have seen some signs that increased short term rental business for some model ranges is starting to bring higher volumes into the marketplace. When that happens, prices tend to reduce but at the moment stability is the watchword in the current trade market.”
Motor traders therefore need to keep an eye out on the market in order to get an idea of how to price their stock, and also what type of stock is likely to sell the quickest. Investing in a motor trader insurance policy that covers a wide variety of stock is therefore advised, so that if you do decide to adapt what you sell due to demand you will always find yourself covered.