Leading digital vehicle marketplace is optimistic for used car boom in 2021

By February 3, 2021No Comments

UK digital wholesale marketplace, Dealer Auction, has expressed its optimism for the continued recovery of the used car market throughout 2021 while emphasising the importance of choice when dealers are building their stock profile.

Reflecting on Cox Automotive UK’s Q3 Dealer Sentiment Survey, which found that two-thirds (64%) of dealers expected used car transactions to increase in 20211, Dealer Auction believes this outlook is still realistic, despite the UK starting the year by entering its third national lockdown.

Following a difficult year for the automotive industry, Dealer Auction believes the used market is a glimmer of hope for the industry.

Le Etta Pearce, CEO of Dealer Auction, commented: “It goes without saying that 2020 was a challenging year for the car industry. But it’s true that out of challenge comes opportunity – and, going into 2021, it’s clear that the used car market is more important than ever. We share our dealers’ optimism in that used car transactions will increase in 2021. It’s not likely that the latest lockdown restrictions will change this sentiment, as winter restrictions were unfortunately always on the cards, and many dealers are continuing to operate online, as they did during the November lockdown.”

Indeed, the acceleration of online retailing and ‘virtual’ services serve to benefit new and used car sales, with dealers rolling out sophisticated e-commerce platforms to connect with customers at home – Dealer Auction believes this means that dealers are already in a stronger position going into 2021.

But there are plenty more reasons for optimism, says Dealer Auction, most notably because the same factors that drove the summer 2020 ‘mini-boom’ in used car sales are still relevant. Firstly, used cars are in a strong position to be the main beneficiary of slow new car sales, which suffered their worst year in nearly three decades in 2020, and now face further uncertainty over Brexit.2 The used car market, on the other hand, despite struggling during the first 2020 lockdown, staged an impressive comeback in June, registering a drop of just 17.5% (up from a 74.2% drop in April).3

Dealer Auction also cited new audiences as a potential continuing driver of success in 2021, with people moving away from public transport in favour of a ‘safe space’ vehicle. There has also been a rise in interest from young drivers – in September 2020, Auto Trader reported a sharp year-on-year increase of 18-to-24-year-olds looking at cars on their website.4 These, Dealer Auction says, present dealers with exciting new marketing opportunities for the year ahead.

Lastly, Dealer Auction also pointed to pre-Covid signs that the used car market was picking up, after three years of decline, and says the pandemic served to sharpen this focus. The Society of Motor Manufacturers and Traders (SMMT) reported the strongest performances in November and December 2019 since the same months in 2016.5

That said, the market is not without its challenges.

Referring to the Cox Automotive’s Q3 Dealer Sentiment Survey, Pearce continued: “Interestingly, 36% of respondents said they expected supply of used cars to decrease, and this is likely to be a key challenge for dealers in 2021, as challenges to the new car market make themselves felt in the used-car realm. Savvy used car dealers are looking to stay ahead of the game and change up their stock sources to access the most desirable, high-quality models with the best margins.”

With more stock sources than any other digital marketplace, Dealer Auction says their platform gives dealers the data they need to support their instincts in finding the best-preowned car stock for their forecourts.

Pearce concludes: “With our platform, dealers will know exactly what someone is looking for in their area ‘right now’, and what margin they can expect. When dealers are looking for opportunities to thrive in 2021, the importance of real-time data cannot be rivalled.”


1 Cox Automotive, Insight Report 2020 (Accessed 14 January 2021)
2 SMMT, UK automotive looks to green recovery strategy after -29.4% fall in new car registrations in 2020, 6 January 2021 (Accessed 14 January 2021)
3 Autocar, Used car sector begins to recover following nearly 50% drop, 11 August 2020 (Accessed 14 January 2021)
4 Auto Trader, Gen-Z’ers flock to driving as COVID-19 restrictions get stricter, 28 September 2020 (Accessed 14 January 2021)
5 SMMT, UK used car market holds steady in 2019 with 7.9 million sales, 12 February 2020 (Accessed 14 January 2021)

About Dealer Auction
Dealer Auction is the UK’s smartest automotive digital wholesale marketplace. We give buyers and sellers more choice, better insight, and greater margin. Dealer Auction is an independent company,Q created through a joint venture between Cox Automotive and Auto Trader.

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