12:26 pm, January 28, 2022
The availability and price of used car stock remain the biggest challenges to dealers in 2022, a new report has found.
Research carried out by warranty provider WMS Group found that an enormous 85 per cent of dealers cited concern about getting their hands on used stock.
The ‘wms’ mini report also found that 71 per cent of dealers are worried about the high prices of used vehicles.
Despite the obvious hurdles in the way of success, 70 per cent the dealers surveyed are feeling confident ahead of the rest of the year.
The report is the second to be published as part of the WMS’s From the Forecourt series and responds specifically to key issues raised by a’ recently launched dealer panel
Responding to the findings, Craig Grant, managing director at WMS Group, said: ‘After more than a year of pandemic disruption, the used car market is soaring – attributed largely to the global shortage of semiconductor chips driving unforeseeable demand for used cars.
‘We’re experiencing some of the highest sales figures we’ve ever seen, however with that has come increasing prices and a significant supply and demand issue – as cited by our dealer panel.’
Other challenges flagged up by dealers included economic uncertainty (33 per cent); recruitment (19 per cent) and Brexit (ten per cent).
WMS also found that before the pandemic just two per cent of car dealers offered ‘click & collect’ and delivery services.
That figure boomed to a staggering 88 per cent in 2021, with the same number of dealers having increased their social media presence as a result of the pandemic.
There was also a 55 per cent increase of dealers who advertise more on online websites than pre-pandemic.
📣From the Forecourt 🚘 With 85% of dealers worried about availability of used car stock, and 71% about high prices – what can dealers do to ensure a profitable 2022? Read our latest report to find out more: https://t.co/MWtlt1fYM3 pic.twitter.com/jWcBJ2UhQo
— WMS Group (UK) Ltd (@TheWMSGroup) January 26, 2022
Grant added: ‘Our latest report finds used car stock availability and pricing far outweighed all other concerns by our dealers, some of which included economic uncertainty, recruitment and Brexit.
‘Along with the findings of our first Dealer Panel research, the report also provides dealers with guidance and advice on meeting challenges head on for 2022, such as a focus on upselling aftersales products despite a move to a much more digital sales process to maximise profitability; investing in new products and services to stand out from the crowd in an increasingly competitive market; and adding value to customers to capitalise on a continuing changing landscape.
‘A key part of us creating our very own Dealer Panel, and collating these research findings, is to ensure we’re on the pulse of the big issues facing the sector today, from the very people that it matters to most.
‘It also gives us a real opportunity to respond to these challenges, ensuring we can fully understand our customers’ needs, but also add real value as a warranty partner – taking a real data-driven approach to what we do.’
The report also touches on the industry’s shift towards electric vehicles.
Earlier today, Car Dealer reported that the UK’s EV industry has received a triple boost in the form of three major electrification projects.
However, in the research, car dealers anecdotally raised that the surge of electric vehicles prompted additional concerns – with both petrol and diesel still readily available.
Grant said: ‘The past two years have seen many highs and lows for the industry, and with the rise of electrification, more change is certainly to come which dealers will need to pay heed to.
‘It is clear that to stand out in a competitive market, dealers who are not yet embracing digital sales processes, click & collect services and online advertising will fall behind the curve, particularly as the online car supermarket model dominates the industry.
‘At a time where there is still much uncertainty for dealers and customers alike, a dealer with a robust suite of aftersales products offers peace of mind to its clients, and whilst used car stock remains a challenge, with many cars and vans clocking up miles, a reliable warranty product will ensure drivers are kept on the road for longer.’
