Q&A: David Grice, Head of Sales

INSIGHT | 3 SEP, 2020

How would you describe remarketing activity now compared with pre-lockdown and year-on-year?

We’ve been incredibly busy. We got off to a very strong start with high levels of activity in June on our UPSTREAM platform, which was up on last year. But July was our busiest month on record, exceeding both pre-lockdown and year-on-year, with double the number of buyers we’ve historically seen.

Have you spotted any new trends in terms of buyer activity?

We are seeing trade buyers, who would normally have been away on holiday in July and August, still actively coming on to the ADESA UK platform to source stock to meet their demands.

We’ve also noticed more buyers, especially new ones, opting to ‘self-serve’ when they utilise our UPSTREAM capabilities. Before lockdown, buyers would traditionally phone in about stock, ask about particular vehicles, or request guidance on how an online auction works. We have now seen a big shift as dealers have quickly become familiar with today’s new way of bidding and buying vehicles online. They seem more comfortable logging in to the platform and browsing for themselves.

There is also a significant increase in customers purchasing cars from our ‘Buy Now’ selection outside of business hours, including placing bids over the weekend and in the early hours of the morning!

With used car forecourts open across all parts of the UK from the beginning of July, what are dealers currently looking for on ADESA’s platform?

Dealers are looking for vehicles they can put up for retail quickly, which is reflected in the high prices being achieved through sales. As a result, we’ve also seen a growing trend for dealers to seek out vehicles available that may require some level of cosmetic repairs, and they are maximising these opportunities.

There was a lot of industry talk about a backlog of defleeted cars building up since March; are you starting to see them enter the wholesale market now?

Yes, the supply chain is more balanced than it was. Companies are defleeting once again, and the vehicles that come on to ADESA UK’s platform are selling extremely quickly. Vendors need these vehicles moved down the supply chain and offered for sale right now to take advantage of the buoyant marketplace.

We’re also seeing an increase of late-plate and early termination vehicles on our platform with low mileages, which have included 20-plates with just 700 miles on the clock.

What’s the position with hybrids and EVs – are you starting to see increased numbers being offered for sale on UPSTREAM?

Since June, we’ve seen growing numbers of hybrids coming on to the platform, many of which are well-specified, desirable models. These proved to be popular, especially with franchised dealers. Independents also purchased some, widening their selections. Demand from our buyers has eased off in recent weeks at a time when more hybrids appear to be entering the used market.

EVs have also attracted many buyers, especially with the range we offered, including Volkswagen e-Golfs and numerous Teslas.

So, dealers are continuing to prioritise petrol and diesel?

There’s been a lot said about the death of diesel, but we have not seen a slump as demand is matching supply. Throughout July and August, dealers bought what was available and diesel remained a popular choice. If end users are doing high mileages and need towing capability, then they’ll likely stay with diesel.

Some of the most popular cars in the used sector are those priced around £10,000; are you still seeing high demand for those models?

As the dealers in England opened up for business in June, there was a higher demand for cars retailing for under £10,000. Whilst dealers want a good selection of vehicles in this price range, early in June it was of particular focus. As we moved into July and August, consumer confidence gained and dealers’ buying patterns were back to normal, bidding for stock across all price brackets once again.

Are you seeing more light commercial vehicles (LCV) on the platform now than you did before the lockdown?

Yes. Our LCV market is at an incredibly buoyant place with high demand from owner-drivers, people setting up businesses and the expanding home delivery sector. We’re seeing a growing number of car derived vans and panel vans on the platform and, as you would expect, these are selling very quickly.

Are you seeing many new buyers coming on to UPSTREAM?

First-time buyers have been growing since May. We’ve noticed a growing trend for new dealers registering with us for the first time and coming back within the same week to buy.

We’re talking to a lot of buyers who previously said they would never purchase a car online without seeing it in person first. The current situation has changed everything and is accelerating this shift to online remarketing with physical auction houses now operating online.

We’re also seeing a record number of unique users logging on to the platform, doubling traditional quantities. Buyers have adapted to changing circumstances and seem to be enjoying the experience.

What advice would you give buyers considering online remarketing for the first time?

I would say just give it a try. Because we are online remarketing specialists, you can buy with confidence from us. Some buyers coming to us had never bought online before, or even considered it, but they soon appreciate the flexibility and immediacy of online remarketing. Customer confidence can be seen with the growing number of new buyers now registered on the UPSTREAM platform.

We appreciate this is a new way of doing things for many buyers, so access to a regular supply of fresh stock with detailed vehicle descriptions is paramount. Whilst we’re an online business, our team members are available to assist customers. We’re making a point of talking to our first-time buyers to ensure the experience is a positive one and help them find their next vehicle with us.

Coming out of lockdown it’s crucial that dealers have quick, convenient and easy access to our UPSTREAM platform, enabling them to replenish their forecourts with desirable stock.

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