Press release

Auto Trader Market Report September 2019 | The Future of Car Retailing

WE’LL BE BUYING CARS LIKE WE ORDER FROM OCADO WITHIN A DECADE SAYS AUTO TRADER

Car retailers will adopt grocery style retail models over the next few years, marketing and increasingly selling vehicles online. This will enable consumers to decide which of the car buying jobs they do online and which they do offline.

That’s according to Auto Trader, the UK’s largest automotive marketplace. Like Waitrose, Morrisons and Marks & Spencer, dealerships will still operate physical locations, but they will no longer be used primarily as showrooms or to complete the sales process. They will be enabled through an Ocado-style retail model which will support their omni-channel approach.

Today, 45% of car buyers say that if they were buying a car on finance they would be happy to do the whole thing online. This rises to nearly two-thirds (64%) for the younger generation of buyers - 18 to 34-year olds.

Auto Trader spoke to 2,000 motorists about their car buying habits for its latest Market Report, The Future of Car Retailing, published today (26 September).

“Dealerships certainly won’t disappear, but they will continue to evolve,” explained Nathan Coe, CEO designate of Auto Trader.

“The future is about digitizing the ecosystem to enable retailers to move to a less labour and property intensive model that better serves car buyers. Successful retailers will embrace technology, invest equally in their online platform as their do their physical one, and re-evaluate the physical elements of their cost base to run more efficiently.

“A more personalised retail interaction will give consumers a seamless journey between the online and offline experiences.”

In the past, car buyers typically visited five retailers; these days that has reduced to two, but Auto Trader thinks the direction of travel is clear and in the future many cars will be bought without many visits at all.[1]

A small number of retailers have embraced digital, not just in the way they market and sell cars but in every aspect of their business including buying and pricing vehicles, and the end-to-end transaction. Today, most retailers only offer the initial vehicle selection and research journey online.

Retailers who have digitised their operations have seen stock turn – the time it takes to sell a vehicle – reduce to less than 40 days versus an industry average of 80 days. Unsurprisingly their margins are also much better – almost double in fact. “Technology can improve the car buying process enormously, making it simpler, more intuitive and more transparent, transforming the experience for consumers” said Nathan Coe.

Online sales of cars are expected to pass one million globally next year, and they will grow to six million by 2025 according to a recent Report from Frost and Sullivan. In 2018, the Report said 618,000 cars were sold online, nearly double the number sold digitally in 2017.[2]

Read the full Auto Trader Future of Car Retailing Market Report here.

[1] Auto Trader Research September 2019

[2] Frost & Sullivan Global Vehicle OEMs’ New Online Retail Strategies, Forecast to 2025

We've got something very exciting launching soon... Wednesday 7th October, save the date 👀 #RPM https://t.co/op0RVqngLN
The @KiaUK Sorento is currently the UK’s fastest selling car, taking an average of just 24 days to turn on UK forecourts according to our Fastest Selling Index. #atinsightoftheday #kia #mazda #peugeot #mercedes-benz https://t.co/0amym8KyIK
Join us on Thursday at 10am for our next #webinar to hear our latest #automotiveindustry updates and #insights and to hear from our CEO, Nathan Coe and @MarshallMotorGp Register now >https://t.co/knn3yUlJ3l https://t.co/HaxCu2EFss
Nathan Coe, our CEO, shared an update with our customers today reassuring them that Boris' announcement earlier this week has had no negative impact on consumer demand. Read Nathan's full thoughts on our latest blog post: https://t.co/sx37kiEHBY
Used car prices continue to climb with last week seeing overall used car prices increase by 7.7%, up from 7.4% the week before and the 20th week of consecutive price growth. #atinsightoftheday #usedcar #Pricing #Petrol #diesel #ElectricCars https://t.co/dmR56DmzNf
Following this week’s government announcement, @stuart_trader, @ClarkRjoclark and @therickw got together to share with you our latest #data & #insights and why there should be no cause for concern in the #AutomotiveIndustry. Watch now at https://t.co/Bch7T5zgYf https://t.co/fTBAjSqCzU
A large segment of buyers believe that owning a car is more important now than it was pre-#COVID19. With that in mind, have you experienced a surge in demand and how have you adapted to meet it? #atinsightoftheday #cardealers https://t.co/J7IikqsNyW
In light of yesterday’s @GOVUK announcement about the new #COVID19 restrictions, our CEO Nathan Coe provides you with the latest #automotive market update and reveals that all indications suggest that consumer demand will continue to remain strong https://t.co/k9dMUo0zCb
Simplifying the car buying process is key to ensuring buyers get their perfect car with ease. So what are you doing and what do you think still needs to be done to simplify the car buying journey? #atinsightoftheday https://t.co/IBp0CHzBgK
The Auto Trader Retailer Awards are back for 2020 in an all new digital format. Register now and join us live to find out if you are one of this year's winners > https://t.co/KwMTCYTfu9 https://t.co/pdnGmFmWcZ

Auto Trader Group plc
Registered in England (Company number: 09439967)

Auto Trader Limited
Registered in England and Wales (Company number: 03909628)

Registered address:

1 Tony Wilson Place
Manchester
M15 4FN
VAT number: GB 614 8918 20

Keep in touch

We use social media to speak to the UK’s largest car buying audience