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Market Commentary - March 2021
Sharing theme's from our conversations with the auto market in New Zealand.
Our team spends a lot of our time speaking with people in the industry and monitoring how the industry is tracking. There's always a few themes that pop up in conversation, so we wanted to share a few of these with you.
These are anecdotal, and only reflect market sentiment from the conversations we're having, but still may give you guidance on how others in the industry are feeling at the moment.
1. Reconsidering purchasing decisions
Because stock has been more difficult and expensive to acquire, some dealers are reconsidering what kind of stock they are buying. For example, if they don’t have the quantity to maintain revenue, should they reconsider the price band or type of stock they’re competing in.
2. Vehicle stock levels
Stock is increasing in levels, but still far lower than we have seen pre-COVID-19. Stock on Trade Me Motors is 66k at the moment, but much of that jump can be attributed to public-to-public sales. The new car market is getting hit hard, with more-than-normal number of vehicles being sold before they land in New Zealand. This also affects the quantity of trade-in stock.
3. Buying stock locally
Buying stock locally can be more expensive and time-consuming, but can fill the gap and keep their yard full which is a more appealing reason for customers to come to your yard.
4. Buyer Activity on Trade Me Motors
Buyer activity isn’t slowing, and we can see traffic to listings is still high. Exposure is currently about focussing on margin rather than turning stock fast, as stock is selling quite quickly. For example, we’ve noticed that dealers tend to be less reliant on discounting stock to sell vehicles.
