Used car dealers include extras to counter stock levels and recession
Used car dealers are tacking on warranties and other incentives in a bid to compete with the new car market as price margins grow more malnourished.
According to RAC Warranty, dealers have introduced these extras as a result of used car shortages combined with a challenging economy which has resulted in slimmer profits.
Ian Simpson, sales and marketing director for RAC Warranty, said: “Used car trade prices are remaining high because there is a shortage of stock but making increases to retail prices is difficult at a time when consumers are feeling the effects of ongoing problems in the economy.
“This means that the margin in each used car is much lower than it was even as recently as last year.
“As a result, dealers are increasingly looking to achieve profitability by concentrating on complementary sales such as upgraded warranties, asset protection and paint protection. This is a strategy that, if properly implemented, can produce good results.
“We are seeing dealers put much more effort into complementary sales and many are approaching us for help in ensuring that they have the right infrastructure in place to make a success of this element of their business.”
See also:
No comments yet
