An increasing shortage of good quality stock in the used car sector means that there is a growing emphasis being placed on vehicle preparation for sale, says the Vehicle Remarketing Association.
The organisation, which represents businesses that between them handle, sell, inspect, transport or manage more than 1.5 million used vehicles every year, believes this will be one of the key trends of the second half of 2019.
VRA chair Sam Watkins explained, “While there is a quite a lot of stock in the market, comparatively little of it is of the highest ‘retail ready’ quality and can be put on sale with minimum preparation.
“This is something that has become increasingly apparent over recent months. It is also likely to become more of a factor because it is being exacerbated by the fact that fleets – probably still the main source of good stock – are hanging on to cars for longer thanks to ongoing confusion over vehicle taxation and generally lower economic confidence.
“The outcome is that many used car retailers are increasingly having to buy stock that is of a lower quality than they would like and then spend time and money bringing it up to standard. This puts resources under pressure and creates quite a lot of additional work.”
The issue was being further complicated by the fact that one of the ways that dealers have been reacting to under-pressure margins is to turn stock over more quickly, she added, with research showing that about a third of dealers were reporting lower margins than a year ago.