NEWS

We are only just into Q2 of the year, and 2022 is proving just as turbulent as the year before.

Nevertheless, the used car market carries on regardless, and Autorola Group has continued to support this crucial sector through increasingly volatile times.

The latest Market Watch report focusses on the price rises experienced in 13 European countries, which was 7.1% over Q1 of 2022. With demand continuing to exceed supply across the majority of territories, and currency fluctuations accounting for additional increases in territories such as Turkey, the outlook for the year ahead is that the current situation looks set to remain in the near future.

Andy Shields gave a brilliant report last month, in partnership with the major publication Fleet Europe, on the pricing fluctuations that we have seen in the used EV market. In a very clear, short video, he explains the market forces behind these fluctuations and why the outlook is bright for EVs as used vehicles. For anyone who deals in these vehicles, it is a must-watch.

We share the news of our recent contract signing between INDICATA and Toyota Motors Europe, which will aid the automotive giant with its used car pricing reports in 12 countries.

I am delighted to see that we end with an article on Autorola Group’s record two years. Each of our business units has excelled over a busy 24 month period, and as a result, we are expanding our business, and our offices. Read more about how we are evolving our group below.

I hope that you enjoy this newsletter, may it be a moment of data-driven insight in the midst of a fast paced world.

Peter
Best regards
Peter Grøftehauge (LinkedIn)

Toyota Motors Europe (TME) has announced a major new contract with INDICATA Europe to roll out its used car pricing data to 13 countries over the next two months.

INDICATA has developed a bespoke reporting suite for TME that tracks all the online used Toyota and Lexus adverts from its own dealer networks across Europe and presents it into an easy-to-read dashboard for each country.

Ability to view used cars at a macro and micro level

This gives TME the ability to view the successes of each of its models at both a macro and micro level in real time. It can view stock advertised levels grouped by brand, model, engine type, vehicle age and mileage by country and track the evolution of pricing and sales volume trends.

The INDICATA contract has already gone live in France Belgium, Spain, Italy, and the UK. From the end of April INDICATA’s data will also be rolled out in Austria, Denmark, Germany, The Netherlands, Poland, Portugal, Sweden, and Turkey.

Used car intelligence

TME has been impressed at the power of INDICATA’s used car business intelligence to aggregate used car stock data in real time. It can be dissected in a variety of ways using filters in its reporting dashboard.

Toyota Motors Europe’s spokesperson said “We are excited to be working with TME to provide them with a real time overview of its Toyota and Lexus stock being sold by its dealers. It will generate some valuable trends data for the brands to enable them to understand how their models are performing in Europe’s used market Europe country by country.”

Andy Shields, the business unit director of INDICATA, has given a talk for the Fleet Europe Remarketing Expert Track.

In a short, fact-packed talk, Andy explains the market forces that were in play at the beginning of 2021, which caused a marked weakness in BEV values early in the year.

Oversupply of BEVs affects market forces
This initial weakness in values was at first hard to understand, as BEVs as a segment had experienced a high year on year sales growth between 2020-2021, although prices had failed to rise to match the market demand.

One of the main drivers behind the lack of price growth was the oversupply of BEVs by manufacturers at the start of 2021, which flooded the market and suppressed the used process.

Response to EU CAFE rules

This oversupply was a response to the introduction of the EU’s CAFE rules, in which overall C02 emissions were capped for manufacturers across their entire vehicle ranges. With strict financial penalties being enforced for every gram of C02 produced above the limit, many manufacturers turned to an oversupply of BEVs at the start of the year as a means of lowering their average emissions.

Two main factors have been behind the value recovery in BEV values over the course of 2021, the easing of the CAFE targets, and the simultaneous global microprocessor shortage.

Reduced pressures to produce EVs

The easing of the CAFE targets for years 2021-2022, coinciding with many manufactures having updated engines and drivetrains across their model ranges for greater efficiency has meant that the pressure to produce zero emissions vehicles to meet the stringent first-year targets has lessened.

At the same time, the microprocessor shortage which has hit global manufacturing in the last 12 months has been felt more keenly across the manufacture of BEVs than traditionally ICE engined vehicles, which has led to supply of these vehicles now lagging demand.

As a result, used BEV prices have stabilised over the last 12 months, and with research from the Boston Consulting Group suggesting that microprocessor production will not recover fully until 2024, BEV prices will remain stable for the next 24 months, if not longer.

To watch the video in full and hear Andy’s insights in greater detail, please see the video in full here:  https://www.youtube.com/watch?v=DnCfXhnrtdM

Since 2019, the automotive industry has gone through a period of global upheaval, beginning with the COVID 19 pandemic and its subsequent lockdowns, which then led into the global microprocessor shortage which has slashed new car deliveries.

For many in the industry, it has been a challenging time, however for Autorola Group, our ability to assist our customers in effective trading despite these challenges has meant that the last two years have been a time of record growth and expansion for the group.

Fleet Monitor has reported record growth

Fleet Monitor has become a key software platform for anyone managing vehicle assets more effectively from cradle to grave. As new vehicle lead times have stalled, leasing cycles have been widely extended as a result. With the increasing pressure on this vehicle stock, fleets, manufacturers, and finance companies have been relying on the Fleet Monitor package to better manage their vehicles.

As a result, we have seen a strong two years of growth within this business unit, driven partly by the utility of the platform, but also due to the hard work of the Fleet Monitor team to maintain and develop deep relationships with customers to bespoke the platform on their behalf.

MarketPlace is in high demand

As different territories within the EU underwent various cycles of restrictions in response to COVID 19, dealers have turned to importing used cars on our MarketPlace online wholesale platform to cater for increased used car demand in their countries. Market Place proved an invaluable asset to dealers during this time, as more than ever, the ability of stock locator to operate across borders meant that appropriate vehicles could always be located and purchased by dealers, no matter the distances involved.

As we continue to grow the features of the MarketPlace platform, so the head office team also continues to grow.

INDICATA helping traders to manage volatility

INDICATA is also continuing a period of strong growth, as at time of market volatility our unique blend of business intelligence and up to date market insights has allowed OEMs, Dealer and fleets and financing houses to always remain ahead of changing market conditions. Now more than ever, the strength of the INDICATA proposition is proving to be invaluable to businesses.

The recently launched INDICATA  stock locator product has been instrumental in helping dealers to manage their stock levels despite the current pressures, giving them the ability to locate appropriate vehicles from across the continent to fill any gaps in their local markets.  

In response to this growth across the group, Autorola Group has purchased new additional offices near our existing headquarters in Odense in order to accommodate our ever-expanding team headcount, which will leave our existing office space for the INDICATA team to call their own. We foresee that the market conditions are likely to remain changeable for some time to come, but thanks to our ongoing investment in our teams and new state of the art offices, Autorola Group looks set to succeed alongside our customers.

European used car prices rose dramatically in the first two months of 2022 as the used market continues to be starved of stock according to INDICATA’s latest used car insights report.

Average used car prices have increased by an average of 7.1% since the end of last year across the 13 European countries as they continue to suffer from a shortage of used stock due to new car sales compromised by global semiconductor shortages.

Majority of markets experience used car price rises
Since December 2021 Italy, Austria, Belgium, and Germany all saw price increases by more than 7 percentage points going into March 2022 equivalent to between a 6.3% and a 7.2% increase. Turkey average used car prices rose by 18.6% between December 2021 and January 2022 with foreign currency exchange rates and supply challenges driving much of that uplift. Average prices have dropped by 3.2% over the subsequent two months.

Meanwhile the United Kingdom has seen average prices fall 1.1% between the peak in January and March with trade buyers and retailers showing little appetite to push up prices. However, they are still 33.2% higher than back in May 2021 when prices started to rise.

Used demand exceeds supply
All countries are operating in a market where used car demand exceeds supply and this looks likely to remain unchanged as restricted new car availability forces leasing companies to extend contracts and lead times impact on dealers delivering new cars to retail customers.

Dealer stock levels fell by between 4.2% (France) and 39.9% (Poland) year-on-year and in February sales were 4.4% lower than January. All thirteen countries in the report saw February YTD sales fall by 0.9%.

Dealer stock levels fall
Moving from February into March dealer stock levels showed few signs of improving with markets like Portugal and Poland suffering from a 7.2% and 6.3% fall.

Meanwhile, used Battery Electric Vehicles continue to grow in popularity with stock turn getting closer to petrol and diesel although there is still some way to go. Diesel stock turn was the highest in February.

‘High prices will continue’
“The high prices will continue to show no signs of abating until the new car production issues are resolved,” explained Andy Shields, INDICATA’s global business unit director.

“We are seeing some mainland European markets looking to import and export used cars to balance their needs but not in big enough volumes to resolve supply issues. The market continues to experience unprecedented issues and looks very unlikely to return back to normal until well into 2023,” he added.



For a free copy of the latest INDICATA Market Watch report go to www.indicata.com