Used car remarketing: how to improve retail effectiveness

ICDP

Publication Number: Management Briefing141/17

Author: Luca Montagner and Ben Waller

Date: July 25, 2017

Tags: Used vehicles, Dealers, Channel strategy

Downloads: 6Rating:

This Managment Briefing for ICDP members builds on recent research into the overall used car market, performance of franchised dealers and large independent used cars retailers, the aim of this briefing is to examine innovation in used car remarketing.  Used car remarketing channels represent a key purchasing route for franchised and independent retailers (alongside part exchange or trade-in), especially in the most developed markets.  Furthermore, the volume of remarketed cars from leasing and rental companies is increasing.  The profitability of this segment is driving competition among operators and channels for these vehicles.

We will focus on the remarketing of ex rental, fleet and leasing cars which, at the end of the first customer holding period are resold to new customers through a range of channels via franchised dealers, independent resellers and online platforms.  After looking at recent trends in the remarketing sector, we will consider the benefits that can be derived by operating a ‘closed’ used car supply pipeline, particularly for OEMs, but also for independent operators.  We will then look at examples of innovation from a variety of types of player, before concluding on how retail effectiveness could be improved by a better integration of remarketing activities within a broader retail strategy.

A key focus of the de-fleeting activity is ex-OEM employee vehicles although a relatively small share of supply with the exception of markets with significant domestic production.  Finally, although we refer to nearly new (or zero KM) cars on occasion alongside ex-demonstrators as they are a key feature of the young used car market, it is not a major focus of the discussion here, and are largely excluded from the data.  

Please follow the link on the right to download the full briefing.