UK set to be one of the largest growth areas for online remarketing
Autorola’s free escrow account provides buyers with extra peace of mind
Physical auctions will continue to sell more vehicles to online buyers
Online sales of used vehicles within the UK’s B2B sector will double in the next five years according to Autorola, Europe’s largest online remarketing company.
Currently around 15% of used cars are sold online trade to trade in the UK, but that will increase to nearer 30% by 2016.
According to Autorola that doesn’t mean the end of the physical auction. Instead this channel will be selling a greater share of its vehicles online alongside a growing number of online remarketing suppliers.
“You can see some realigning of physical auction networks, but that is about reduced volumes of used vehicles coming back into the market. Their business model is all about volume which is why some of the major sites are being mothballed, but the remaining sites combined with growth of online providers like Autorola will fuel this online growth,” said Peter Grøftehauge, Autorola’s chief executive.
He cites the main reason for Autorola’s growth is that vendors and online providers are combining to give buyers greater confidence to buy a vehicle unseen through improved vehicle provenance, descriptions and photos.
“We have invested in securing buyer’s funds in an escrow account which protects their money until they receive their vehicle and are completely happy with it. Unlike some providers we provide this service free of charge and have done so for over 10 years; buyer reaction has been very positive during this time,” said Grøftehauge.
“More recently the difficult economy has meant dealer groups, car supermarkets and independent traders have been running their businesses with fewer people, so if a buyer can bid for vehicles through three or four online and physical channels in a single day without having to leave their office it makes sense,” he added.
In 2011 Autorola estimates it will transact over 220,000 cars through its online platforms across 17 European countries, around 10,000 in the UK. In five years it estimates this will rise to half a million vehicles in Europe, with the UK and eastern Europe likely to be the main growth areas.