With the pandemic halting physical auction sales, 2020 was the year in which vendors embraced online remarketing. How would you say they’ve adjusted to this new way of doing things?
Many were forced to go online for the first time; with physical sites closed there was no other option. We found they adapted quickly and are now comfortable using it.
For vendors it was a matter of changing their mindset. Before the pandemic many believed an online auction had to be combined with a physical sale to get the best possible market value performance.
But we’ve been able to prove that’s not the case. They now realise they don’t need a physical auction to achieve market value for their vehicles.
How have dealers responded to using online remarketing for the first time?
For dealers it’s all down to performance. The first lockdown in March 2020 created enormous pent-up demand, especially from consumers looking for alternatives to public transport, which meant values were strong and that made it easier for dealers to try it out.
Since then they’ve enjoyed the flexibility offered by online remarketing and the speed of purchase.
I believe it’ll be hard to convince dealers that there is a requirement for physical auctions when the pandemic ends and lockdowns are no longer required.
What role has technology played in convincing first-time vendors and dealers that online remarketing can work for them?
Technology has played a massive role in changing views towards online remarketing.
For vendors, our ADESA IVI (Intelligent Vehicle Inspection) tool uses Artificial Intelligence (AI) technology to give buyers the confidence to purchase by providing detailed, non-subjective condition reports and supporting them with imagery.
Before there was always the belief that you would never achieve a true market value online without buyers being able to actually kick the tyres. ADESA IVI addresses these concerns by giving buyers the confidence they require to purchase a vehicle and vendors the confidence of knowing AI-generated appraisals will help them achieve their market value online.
Do you believe a paradigm shift from physical to digital is now happening?
Definitely. For OEMs, funding and leasing companies and fleets there is no reason to go back to physical auctions because they’ve now seen how an online-only platform provides a quicker process. The results they achieved over the course of last year speak for themselves.
The pandemic has accelerated this change and the benefit we have is the ability to offer vehicles for sale straight away on ADESA UPSTREAM without needing to wait for the next planned event.
As a company, how has ADESA UK adapted to the shift to digital?
We have always positioned ourselves as a digital-only specialist, so we were fully prepared when more vendors and buyers started looking for online remarketing solutions.
Recent months have seen us rollout improved functionality and navigation on UPSTREAM to make it even easier for buyers to source stock whenever they need to.
Buyers can now reap the full benefits of viewing vehicles that have undergone an IVI inspection with granular AI-generated condition reports and imagery identifying damage down to the slightest scuff.
This greater transparency is enabling them to make more informed decisions before placing bids and this is resonating with dealers, especially those previously more familiar with examining vehicles at close quarters in person.
In December you updated your sales programme for dealers. What prompted this move and will it continue into 2021?
We’re keen to work as closely as possible with our franchised dealer partners, so we identified an opportunity to help them remarket unwanted part-exchanges and over-age stock by targeting these vehicles at the most appropriate buyer base.
It’s all about presenting the right cars to the correct audience at the best time. We’re talking to various dealer groups about holding dedicated sales for them from early 2021.
We’re also planning to increase our presence in the light commercial market over the course of 2021 and will share more details this year.
As someone who is talking to vendors and dealers on a regular basis, what do you think will drive supply and demand as we enter 2021?
We think the possible lack of new car supply caused by Brexit will drive more buyers into the used and nearly-new car markets and this could prompt another increase in values at auctions.
We also expect to see an influx of stock into the wholesale market following higher volumes of defleeted lease and rental cars becoming available and an increase in repossessions. Together these could take up some of the slack in new car supply.
There was a lot of uncertainty in the market in 2020 as various parts of the country went into lockdown or tiered restrictions. However, going into 2021 the mood among the vendors and dealers we’re talking to has become more optimistic since the rollout of the Covid-19 vaccine. So we’re expecting a busy start to this year.