Norway faced with challenge to pioneer used EV management solutions

Feb 6, 2019   written by Autorola

Norway is leading the way when it comes to the transition to electric vehicles with the highest concentration of plug-in-vehicles across Europe and sales continuing to rise. However, a lack of demand in the used market is highlighting some of the challenges this ‘new’ sector faces. Here, Peter Grøftehauge, CEO, Autorola Group reports.

Norway has the most developed EV market in Europe, if not the world and in 2018 31.2% of the 147,929 new cars sold were EVs according to data from the independent Norwegian Road Federation (OFV).

The Nissan LEAF is the best-selling car of any kind in Norway followed by the BMW i3 and the Tesla Model X, with a reported 30,000 pre-orders for the new Tesla Model 3 this growth is likely to continue.

100% zero emissions
However, whilst this is good news as the Norwegian government aims to achieve 100% zero emissions new car sales by 2025, a key challenge which Autorola is supporting the market with is the management of the used cars when they come back from lease. Although demand for EVs is very high across the board, it is proving challenging to resell used EVs when lease options on new vehicles appear so appealing.

Premium segment vehicles best sellers
‘At present, used EVs are priced too high for the market conditions,’ explained Peter Grøftehauge, CEO, Autorola Group who also points to two out of three best-selling EVs in the country being premium segment vehicles.

Peter continued, ‘Rightly, dealers want a return on their investment, but a lack of demand locally is driving them to explore the potential for export but even this has its challenges at present due to the lack of true insight into EV markets. It’s a challenge we are looking closely at and working with our various partners to help resolve.’

Oversupply in the used market
A key aspect of this oversupply in the used market is centred around ‘trust’ relating to the uncertainty still surrounding long-term product reliability beyond the length of a vehicle’s manufacturer warranty along with challenges around infrastructure. A consumer survey by Norsk Elbilforening also indicated that consumers have less confidence in Norway’s political ability to maintain a predictable EV-policy.

‘There is no quick fix to this,’ explained Peter. ‘What the domestic market is willing to pay for a used EV does not currently align with the value vendors are placing on the vehicles. The result is a stagnated supply and demand curve which is seeing vendors sitting on the assets and seeking alternative means of disposal.’

Exporting used EVs
One area some vendors are exploring is the opportunity of exporting used EVs, however this is also presenting challenges as there are currently no obvious markets where demand necessitates imports within Europe or further afield.

‘Norway is in a very interesting position and is a real case study for the EV sector. Adoption of the technology has been world leading, in many ways thanks to the associated infrastructure and government incentives, but the rest of the market is finding it a challenge to keep pace,’ said Peter.

He continued, ‘We look at products such as used personal contract purchase (PCP) in the UK and beyond, and know it is coming to the rest of Europe. In my opinion, this is a solution that is needed and will certainly support the used EV sector.’

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Introduction from Peter

Dec 4, 2018   written by Autorola

As we come to the end of 2018 we cannot remember a year when the industry has changed so dramatically so quickly.

With the pressure on cities to reduce emissions and the quest to modernise the new car emission and fuel consumption testing procedures, many markets have fallen out of love with diesel cars.

These legislation changes have been responsible for used diesel demand falling in some countries and our MarketPlace director Morten Holmsten highlights in his article how Autorola has been at the heart of the import and export activity which is balancing supply and demand across Europe.

Used market is in good health
While some car makers still get to grips with the new WLTP legislation for new cars it’s clear the used market is generally in very good health which looks like continuing well into 2019. New car sales are falling in some countries and the industry automatically invests more time and money in buying and selling used cars.

2018 will see the group auction over 800,000 used cars online to buyers in 40 countries on behalf of over 1,700 vendors which is a record.

As more vendors and buyers embrace selling and buying used cars online we will get closer to one million vehicles in 2019. A huge landmark which would not be possible without the open mindedness of our customers.

We wish our friends, our colleagues and our clients a Merry Xmas and a Happy New Year and look forward to seeing you all at the ENG Remarketing conference in January.

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Autorola Marketplace is driving the European used car import/export market

Dec 6, 2018   written by Autorola

Autorola’s Marketplace online remarketing portal has been at the heart of a huge rise in cross border used car sales in 2018 due to emission legislation reducing demand for diesels and a major shortage in used cars in some countries.

More than 21% of the used vehicles sold either been imported or exported by the Autorola platform in 2018, which accounts for 21% of total vehicles sold online. This figure is as high as 60% in some countries where demand for diesels has fallen.

Pan European remarketing strategies
It has meant Autorola working with more vendors to develop pan-European remarketing strategies to accommodate the cross-border exchange of used vehicles. ‘Europe’s biggest challenge is how countries respond to introducing new legislation to improve air quality,” explained Morten Holmsten, global sales director, Marketplace.

Used diesel demand impacts the leasing sector
“Legislation has caused used diesel demand to fall dramatically in some countries causing a major challenge for the likes of leasing companies where thousands of used diesels are being de-fleeted every week,” he added.

Germany and France are leading the way to reduce emissions and improve urban air quality which is forcing more diesel used cars to be exported to Poland, Africa and the Middle East. Belgium is also exporting more cars following new fiscal reforms that incentivise buying petrols, hybrids and EVs, while up to 55% of ex-leasing stock from the Netherlands is being exported to Portugal, Croatia and Romania.

Importing more used petrol cars into Germany and Belgium
Germany and Belgium are in turn importing more petrol used cars to balance the supply, while the Netherlands is importing cars from Denmark and France.

European new car sales plummeted in 2009-2011 due to widespread recession, with countries like Portugal, Spain and Italy hit the hardest. It also took these countries the longest to recover, but now their economies are growing the demand for used cars is outweighing supply and they are utilising the MarketPlace portal to source stock.

Portugal is importing used cars to satisfy a growth in demand
Portuguese dealers are importing €10-12,000 cars from the likes of France, Germany, Belgium and the Netherlands while Spanish dealers are sourcing three to eight-year-old sub- €10,000  used cars for its customers.

The Italian market is typically importing lower value used cars and exporting around 20% of their high value high specification used cars to Germany and Austria, which then sell cars to the Czech Republic, Slovakia and Slovenia

“It’s exciting for our Marketplace platform to be at the heart of the European remarketing industry supporting the ever-changing supply and demand for used cars,” said Holmsten.

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Autorola Solutions rolls out Fleet Monitor to Santander Consumer Bank AG, Germany

Dec 7, 2018   written by Autorola

Autorola Solutions has rolled out its Fleet Monitor vehicle asset management portal with Santander Consumer Bank AG in Germany.

The project – in complexity and number of parties involved in the entire set up – has helped reshape Santander’s operations and is delivering value on a daily basis by providing greater analysis and insight into its remarketing results and supply chain partners’ performance.

Department manager at COLLECTION BUSINESS UNIT for Santander Consumer Bank AG, Germany, Mr Sebastian Kipp says “Autorola Solutions gave us the possibility to adjust the Autorola Fleet Monitor perfectly to our processes and needs.”

The deep knowledge of the remarketing process at Autorola and the international project team made it possible to implement the project without any impacts on our daily business, while switching the system.

Mr Kipp continues, “The Autorola Fleet Monitor allowed us to digitize and scale many points of our remarketing process. This gave us the chance to boost the remarketing time and to tighten control over the whole process. Moreover, the possibility to access all data of the included vehicles, made it possible for us to analyze the remarketing results and performance of our suppliers at a new level.

Autorola Solutions provides customised solutions to fleet owners of all sizes with all customers assigned a project manager who oversees the entire implementation process – from the initial contact through to implementation.

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Market days supply sees break from seasonal trend

Dec 6, 2018   written by Autorola

Heading into the final quarter of 2018 and dealers are usually looking to increase their used stock levels to meet the sales rush in January. However, the 1 September introduction of the Worldwide Harmonised Light Vehicles Test Procedure (WLTP) saw dealers with a glut of zero miles cars in stock that they have been concentrating on selling. The result is a break from the normal seasonal trend, with market days supply (MDS) falling in most countries.

Italy turning stock faster 
For example, the Italian market has gone from 105 days supply in August to just 66 days by the end of October meaning it is now turning its used car stock at a faster rate than Germany. 

By contrast the Spanish market has failed to see levels fall below 70 days since February 2018.

Diesel impacts Spanish stock levels
Drilling deeper into Indicata’s data by fuel type and you can see that the challenge in Spain can be specifically linked to diesel stock levels. Used car buyers are increasingly looking for petrol cars over diesel in many segments. But MDS is just part of the picture and you need to also consider sales trends to see the full supply and demand picture in each market.

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Autorola Group hits the road for auto events

Dec 4, 2018   written by Autorola

It has been a busy few weeks for Autorola Group with various appearances at automotive events across the globe.
Group CEO Peter Grøftehauge spent time addressing the Welcome Tomorrow 2018 PARAR conference in Brazil on the digital impact on the automotive industry. PARAR is the major mobility event in Latin America with over 3,000 people attending the three-day event in person while a further 10,000 joined in online. Autorola Brazil also attended FENAUTO in October.

How Indicata big data helps sell ex-lease vehicles
Morten Holmsten, Autorola’s global MarketPlace director, was guest speaker at the Aumacon Top 100 Lease event in Amsterdam where he provided insight into how Indicata big data helps sell ex-lease vehicles.

Autorola embracing personal mobility
Autorola Group then supported the Fleet Europe Summit 2018, held on 27-28 November in Barcelona, by sponsoring the Fleet Europe Village which was home to leading fleet and mobility suppliers.

Morten was spotted embracing the discussion around personal mobility at the event by trying out a bicycle on the ALD Automotive booth.

We will see everybody at the ENG Vehicle Remarketing conference in Amsterdam on the 24-25 January 2019.

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European new car sales impacted by WLTP introduction

Oct 11, 2018   written by Autorola
After three consecutive months of growth, culminating in a 28.1% increase in new car sales for the European Union’s biggest five car markets (Big 5) in August 2018, the true impact of the Worldwide harmonized Light vehicles Test Procedure (WLTP) saw sales plummet 22.3% in September.

At the end of the first half of 2018, the Big 5 were up 1.0% although this was mainly due to the drag caused by the decline in the UK car market. However, the move to WLTP for all new cars registered since September 2018 saw a flurry of day registrations or pre-registrations across Europe.

New car sales stall on WLTP introduction
Excluding the UK, the remaining 4 major European car markets were up 3.2% for the first six months of the year. But by the end of August, the same four markets were up 6.6%, with the UK dragging the overall August year-to-date (YTD) growth down to 4.3%, but still well above the 1.0% growth for the first half of 2018.

The introduction of WLTP from 1st September has meant manufacturers are unable to sell vehicles which have not yet been tested and this has resulted in a significant number of models being unavailable to order or with very long lead times. Manufacturers are removing some models or derivatives which require re-engineering to get a good result under the new test procedures. Other manufacturers are waiting in long queues for their models to be tested by the official regulatory bodies before they can sell them.

Downturn in new car sales set to continue
With dealer’s stocking plans full of day registrations and long lead times on quite a few models and derivatives the downturn in new car sales is expected to continue for the remaining three months and even extend into 2019 for some brands.

Following the drop in September, new car sales for first three quarters of the year for the Big 5 are up 0.8%. At a country level Spain is still seeing the strongest growth up 11.5% after nine months, followed by France up 6.5% with Germany third as sales growth is now just 2.4%. The political turmoil in Italy has seen sales go into reverse with total sales for the first three quarters of 2018 now down 3.0% over the same period last year; whilst the UK new cars sales continue to drop sharply with sales now down 7.5%.

The WLTP effect means the Big 5 are likely to sales falling sales for the remainder of the year and end the year down 1.9% which equates to an average 11.2% fall for the final quarter.

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End-to-end solution helps manage repossessions

Dec 7, 2018   written by Autorola

Vehicle repossession is often a complex process which requires consideration not only of legislation in order to protect consumers and organisations, but also of various stakeholders.

Autorola Solutions recognises this area can prove challenging and therefore provides an end-to-end solution to manage the entire process via its connected online platform.

Risks increase when payments are in arrears
”When payments are in arrears, your risk increases,” explains Ib Kimose, Global Solutions Director at Autorola. ”Therefore, swift action and strict control is a must, as you want to repossess the car as quickly as possible to minimise the lead time between gateways – both operational and legal – in order to sell the car to recoup losses.”

Autorola Solutions allows fleet operators to have full control over their cars every step of the way and to measure on all KPI’s. The platform provides a powerful tool to reduce operational costs and financial risks, and simplifies every part of fleet and resource management.

Flexibility is key
Ib continues, ”Flexibility is key and inherent in our way of thinking. Our Business Partner set up takes collaboration to a new level, helping to integrate all key business partners into a users own customised flow in Fleet Monitor. This enables operations to be streamlined and optimised at individual levels.

The system also allows users to communicate online with all stakeholders, generating receipt documents, uploading relevant documents/certificates and managing deregistration processes.

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Used car sales in the UK increase by 7% in October

Dec 6, 2018   written by Autorola

In the recent Indicata Automotive Market Trends Report November Fleet Europe special we showed how the data can be useful in analysing market days’ supply and contrasting stock levels against sales to give an average ratio. This month we thought it would be useful to show how quickly, or slowly things can change.

Sales up, stocks static
Across the UK B2C used car market total sales in October for the 15 brands shown in the chart rose by seven per cent to 286,014 units over the previous month, whilst online stock levels were up just 0.7% to 420,720 cars according to Indicata’s database.

This pushed up the average sales/stock ratio to 68% from 64% last month as dealers pushed sales hard in the run-up to the Christmas break.

Ford holds top-spot but ratios slip
Ford remained the highest selling B2C used car brand by volume, although sales fell two per cent in October. Vauxhall retained second place in volume terms with 34,052 B2C used car sales, whilst Volkswagen leapfrogged BMW to take third place with 27,917 cars, almost eight per cent more than BMW.

Looking at the sales-to-stock ratio, Ford slipped to second place behind Volkswagen which achieved a 77% sales/stock ratio compared to 75.6% for Ford. Some 18.7% separated Volkswagen at the top and MINI at the bottom of the 15 brands.

Data analysis key to avoiding risks
The key to ensuring the right stock and sales mix is to drill down deeper into Indicata’s data and analyse the vehicles at a model and fuel type by region. This will avoid the risks of overpaying for slow-moving vehicles and getting the right cars in the right place to meet demand.

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Czech automotive sector continues upward trajectory

Dec 4, 2018   written by Autorola

The Czech Republic automotive sector has matured significantly over the past 12 months according to Rene Buzek, managing director of Autorola Czech Republic.

With a stable economic and political base, demand for new vehicles within the Czech Republic is high and has seen vehicle manufacturers turn their attentions on improving business infrastructures via the implementation of workflow management tools to enhance automation. This has been led by Fleet Monitor from Autorola Solutions.
‘We have witnessed an increasingly structured way of working within the market,’ explained Rene, ‘which has been positive for business and seen demand for our Solutions product increase. We are on the cusp of starting up some new projects with OEMs within the market with a view to enhancing their processes and workflows.’

Leasing segment overloaded
The leasing sector is what Rene describes as ‘overloaded’ with vehicles at present with unrealistic residual values resulting in higher levels of stock and stocking days. The private buying market is simply not absorbing the volume of vehicles coming to market and, as a result, banks are showing signs of nervousness and applying pressure on lease companies to ensure they speed up used sales, so they can see return on investment.

Rene said, ‘From our perspective this challenge is a great opportunity. We are working together with the leasing sector to relieve the pressures to find the right pricing models and to keep stock days under control. We are using Solutions to educate and coach the leasing sector about which vehicles to dispose of via which channel to optimise both stocking days and pricing.’

Rise in export
Despite the overall used car sector being buoyant, the challenge of choosing the correct channel for disposal of certain vehicles has also seen a steady rise in the volume of vehicles being exported. With certain ‘lower specification’ vehicles becoming less desirable as the market matures, some of the major vehicle handlers are turning to export as a means of disposing of the surplus domestic stock.

However, as the lower specification vehicles leave the market via export, the import market is steadily developing with the demand for higher specification, lower mileage vehicles rising. René said ‘In line with the new sector, over the past 12 months the demand for high specification, lower mileage used vehicles is too, very positive.’

These imported vehicles are entering the market from Austria, Belgium and, predominantly, Germany.

Global issues rumble in background
Although the market has and continues to evolve at pace, some of the current major global challenges appear to have had little impact on the market to date, but the rumblings are clear.

As the ‘demonisation of diesel’ continues to spread post- ‘Diesel Gate’, the market for diesel powertrains remains buoyant domestically. However, there are some rumblings within the market that plans are afoot to implement regulatory measures, in line with EU recommendations.

Rene said, ‘This is causing a bit of concern within the market at present, but I am confident that we will not see big change within the next five years.

‘The impact of WLTP is another issue that has been under great scrutiny in recent months, throughout Europe, and looking at the domestic data – registration figures have reduced, yet the market remains positive.’

Supporting the change
With the evolution of the market well underway, technology is beginning to play a key role in progressing business across the board but Rene points to one of the key challenges within the market as being centred on mindset and the willingness to adapt to the new order.

‘It’s a challenge in some areas for people to accept the need to change their remarketing strategies,’ said Rene, ‘but on the whole, the market is recognising that it needs to bring in new processes, business models and management flows to satisfy demand.’

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