Online remarketing trends across Europe

Written by Autorola in category 
May 26, 2021

MarketPlace business unit director Morten Holmsten updates us on the fast-changing online remarketing trends across Europe.

The European used car sector is extremely busy with conversion rates and prices at a record high, but the one challenge that all countries are facing is the lack of supply.

We have experienced 8% fewer used cars on our MarketPlace online platform during March and April which reinforces the shortage of stock.

Used car bids are increasing
At the same time, we saw the number of bids rise by 31% in April and 8% in May so there are more dealers in the market to buy a rapidly falling number of used cars. Prices have risen by 3-4% for two to four-year old cars during this period which are the used cars currently in demand with consumers.

Generally, Autorola is at the heart of a major cross border focus as countries balance used car imports and exports to satisfy demand but this is happening less and less currently. Now that the semiconductor problem is growing so the number of new cars being produced has fallen which is restricting the numbers of used cars being de-fleeted by rental and leasing companies.

These sectors generally provide a large percentage of the used stock coming into the market at between 2-4-years old sweet spot in the market, but not so far in 2021.

Semiconductor problems
Talking to the industry we believe that some car makers will be impacted heavily by the semiconductor problem while others will see little or no impact on production. However, until this impact is made more transparent many dealers are holding onto stock rather than considering export.

We expect it will be Q3 before production starts to improve and then there will be many back logs of orders to deal with before new car supply is back to normal across Europe. Turkey for instance is badly impacted as most of its new cars come from Turkish factories, which currently have seen production decimated due to the semiconductor shortage.

Restricted stock levels in Portugal and Poland
Countries like Poland and Portugal have an appetite to import used cars currently to improve stock levels, but their retail markets are not able to pay the higher prices of cars they need to import stock. Therefore, used cars will become even more scarce in the coming months.

According to our latest INDICATA report stock levels in Poland fell by 6.2% from April to May and are 38.3% lower than the start of May 2020, but that will not change anytime soon while prices are so high.

Danish demand for small EVs is high
In Denmark, a change in the luxury tax on EVs is already being experienced with a high demand for smaller, cheaper electric cars like the Tesla 3. The VW iD4 was April’s fastest-selling used car at 27.4 days which puts this trend into perspective.

However, Denmark is one of the few countries where demand for used EVs is high. Many countries are seeing EVs are selling more slowly than petrol, diesel, or hybrids as the price differential between zero emissions and the other fuel types is simply too high. Stock turn of EVs is low which is building growing stocks of used cars in many countries. Perhaps with the high used car demand across Europe and a growing appetite from asset owners to clear these cars off the balance sheet used EV prices will start to fall over the coming months to boost consumer interest.

Helping buyers and vendors deal with market challenges
As always, the European used car market is forever changing and in recent months countries have had to deal with the Covid-19 pandemic, the semiconductor supply issue, and Brexit for the UK. The Autorola Group continues to support vendors and buyers to develop remarketing strategies to deal with these challenges.

We look forward to working with you.

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