Operating losses at online used car marketplace Motorway increased to £43.6m in 2022 – but bosses insisted this was in line with plans.
The website, which connects private car sellers with a network of 5,000 buying car dealers, saw the value of the products it sold on its platform rise to £1.7bn.
Accounts, just filed at Companies House, show the firm generated revenues of £41.2m from those sales, more than double the previous year (2021: £19.8m).
Gross profit amounted to £35.9m. However, due in part to ‘significant marketing activity’ and expanding staff numbers, the firm made an operating loss of £43.6m, up on the previous year’s £12.5m.
Motorway said this included a £5.1m ‘administrative expense’ in terms of a non-cash adjustment related to share-based payments of share options granted to employees.
The losses, insisted the company, were in line with its ‘investment plans’.
Motorway is a high growth, digital disruptor and has raised more than £200m in four fundraising rounds.
As a result, the company says it has ‘significant cash reserves’ and access to finance if needed to ‘cover ongoing operations and future developments’.
Tom Leathes, CEO and Co-founder, told Car Dealer: ‘Motorway achieved impressive growth in 2022, and we are very proud of these results.
‘This accelerated growth is despite a very challenging macroeconomic environment in 2022, with the energy crisis, rising inflation and cost of living challenges throughout the UK.’
The Motorway team has now grown to more than 400 staff, based in London and Brighton, and recently announced it had acquired Total Car Check.
Leathes said he is excited for the future for Motorway and 2023 has so far seen the business continue to accelerate.
He added: ‘Our rapid growth has continued in 2023, both in terms of sales and unit economics. With significant funding reserves in place to power the next phase of growth and innovation, Motorway is on a strong path to profitability.
‘This year we’ve already launched a number of landmark new products and features, including Motorway Pay: A powerful, hassle-free service to make buying cars from consumers easier than ever.
‘Our recent acquisition of Total Car Check adds further power to the platform, and we are very excited about the next phase of our journey.’
No dividends were paid out during the 2022 financial year while the highest paid director received emoluments of £180k.
Leathes added: ‘When we launched Motorway as a three-person team back in 2017, we had a very big vision for the future of the used car market.
‘While we have come a long way since then, we’re still early in our journey, and there is a lot still to do to fundamentally improve used car transactions for car dealers and consumers in the months and years ahead.’
Motorway won the Car Dealer Power Award for the Stock Acquisition category in this year’s online event (above).
Motorway was also the subject of special Car Dealer Investigation video charting its birth and growth to the used car disruptor it has become. You can watch that at the top of this post.