Europe Used Cars Market 2022-2027

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    Published- Sep 2022

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    EUROPE USED CARS MARKET

     

    KEY FINDINGS

     

    ▪The Central and Eastern Europe used cars market size is comparatively smaller than the top 5 western EU markets(€350B)but it is estimated to grow at XX% CAGR from 2020 to 2027 in terms of value

    ▪As per leading used car retailers, the principal constraint to their growth is the ability to recondition cars quickly enough, as opposed to consumer demand which remains robust post COVID  

    ▪Gasoline cars have been able to better retain their residual value compared to Gasoline, HEV and BEV cars for comparable age groups 

    ▪The leading players are targeting €1,800 to €2,400 gross profit per unit(GPU) in Western Europe and €XX to €XX GPU in Central and Eastern Europe

    ▪ Leading vendors like Autorola have been working with more vendors to develop pan

    – European remarketing strategies to accommodate the cross

    – border exchange of used vehicles since 2018

    ▪ Retail revenue has been the primary growth driver for many used car retailers followed by wholesale and other revenue streams

     Online engagement followed by excellent consumers offline experience is the most commonly followed go to market strategy by leading used car retailers in Europe and is likely to continue in future as well

     

     

    INTRODUCTION

    With the pandemic influencing the fundamental lifestyle and buyable range of diverse customers in terms of automotive sales, used cars have been increasingly important in recent years.

     

    Used vehicles are more desired by new or first-time buyers of automobiles in various parts of the world because they assist instil the necessary user driveable experience, which has a beneficial influence on a long-term use time frame.

     

    The emergence of the Internet has altered the power struggle between dealers and consumers in terms of needs towards the European Nations’ Used Car Segment.

     

    Buyers may now have a competitive advantage. Customers are becoming more aware about automobiles, including their quality, residual value, pricing applied, finance costs, availability, and, more and more frequently, the actual profit margin that the dealer makes when closing a purchase.

     

    The value of the used automobile market is increasing dramatically. The key to growth has been information transparency and symmetry, as buyers continue to employ the same technique to research and information collecting in their search for used automobiles as they do in the new car purchase process.

     

     

    infographic: Europe Used Cars Market ,Europe Used Cars Market Size, Europe Used Cars Market Trends, Europe Used Cars Market Forecast, Europe Used Cars Market Risks, Europe Used Cars Market Report, Europe Used Cars Market Share

     

    The establishment of trust-inducing initiatives such as certified used vehicle programmes is the most essential success strategy in the used automobile market.

     

    These programmes offer the best protection against channel competition and enable dealers to dramatically boost margins while providing a new source of revenue for OEMs.

     

     

    To know more about Global Used Cars Market, read our report

     

    EUROPE USED CARS MARKET DYNAMICS

     

    The used vehicle market encompasses all private and remarketed sales of used automobiles. Private sales are ones in which both the buyer and seller are private persons. Remarketing is the sale of automobiles by businesses that have previously utilized them for business or to create money. Manufacturers, rental and leasing businesses, and others all dispose of used automobiles through remarketing sales.

     

    The European Union nations, France, and the United Kingdom are among the world’s largest used automobile markets. The used automobile sector creates significant economic income in various markets. In comparison, the used automobile market in Canada, Japan, and Spain is weaker.

     

    Dealers throughout Europe have witnessed significant rates of consolidation, owing partly to the Block Exemption Act, which went into force in 2002. According to sources, the number of franchised dealer sales outlets in France has decreased by around 17 percent, while the number of outlets in Germany has decreased by about 18 percent.

     

    With more knowledgeable platforms and outreach, the market share of independents is likely to fall in Europe because leaders are increasingly looking for other channels to remarket their vehicles, such as auctions (ex: Germany, Holland), dealers, export, and re-rental, with Italy and other Eurozone nations serving as examples.

     

    The auction on platforms of various levels has been the other primary target of growth for used automobiles inside the industry. Used vehicle auctions are mostly established in England, which was a member of the European Union until January 2021, and to a lesser extent in Germany and Holland, with other nations catching up.

     

    However, players such as Manheim and BCA have devised ambitious expansion plans throughout Europe. Leasers are increasingly viewing auctions as a remarketing route at the expense of independents. Online auctions are becoming more popular.

     

    Buying a used electric car has a number of advantages, not the least of which is cost savings. Buying a used EV is becoming more common, with roughly 20% of the value of a new car being lost the instant you drive it away. In the United Kingdom, roughly three used automobiles are sold for every new vehicle.

     

    However, there are numerous more benefits in addition to financial and environmental savings. Factory warranties are longer than ever these days, so longevity is better than it has been in the past. It’s also feasible to find a high-spec used electric vehicle. The environmental advantages of electric vehicles are very compelling. While walking, cycling, and taking public transportation are always better for the environment, buying used and switching to electric is still an excellent option.

     

    When compared to gasoline or diesel cars, EVs emit extremely less pollutants into the air. Particles are still released by tyre wear and braking, but there are no nitrogen oxide emissions because there is no tailpipe.

     

    Battery packs are also surviving much longer, making buying used a safe option. The battery in an electric automobile won’t need to be replaced for 10 to 20 years, and it can go roughly 150,000 miles during that period. With an increase in new electric car sales, there will surely be an increase in used vehicle sales, fueled by the gasoline crisis and the prohibition of fossil-fuel models.

     

    Driverama is well-positioned to grow quickly thanks to its own technology, distinctive data science, and current automotive infrastructure. The technology will soon make it possible for users to purchase or sell cars anywhere in Europe while utilizing real-time data and price variations to negotiate the best deal. 

     

    For the first time, a buyer in Munich, for example, can purchase a car in Amsterdam and have it delivered to them in Germany, backed by a no-questions-asked guarantee. fourteen-day money-back promise

     

    In an effort to counter the rising popularity of online vendors like Cazoo and Cinch, Stellantis has introduced its Spoticar used car service in the UK. After the brand’s inception in France, the UK marks Spoticar’s tenth European market launch. There will be vehicles on the website that are not made by Stellantis.

     

    Following the acquisition of Cluno, Germany’s top automobile subscription service, in February, Cazoo, one of Europe’s top online auto sellers, revealed that it has begun offering its used car marketplace in both France and Germany.

     

    In the two European nations, the U.K.-based company already has “hundreds of automobiles” available, each of which includes a 12-month guarantee. Buyers will also receive free vehicle delivery to their front doors, backed by a seven-day money-back guarantee, as an extra bonus.

     

    Aramis Group SA and Cazoo Holdings Limited have reached an agreement for Aramis Group to acquire 100% of the capital and voting rights of Cazoo Trading Italy S.p.A., which will be rebranded to brumbrum with immediate effect, as part of Cazoo Group Ltd’s strategic review of its European business.

     

    The business sells about 1,600 used cars B2C each year, generating about €30 million in revenue. With this transaction, Cazoo has the chance to quickly exit the Italian market in accordance with its previously announced plans to leave mainland Europe, advancing its goal of becoming profitable without the need for additional outside funding.

     

    Aramis has an excellent opportunity to enter, at favourable financial terms, a strategic market in continental Europe that transacts 20 billion euros annually and where Stellantis, the majority shareholder of Aramis Group, has a significant presence.

     

    POTENTIAL IN EUROPE USED CAR MARKET

     

    Europe is now world`s second biggest EV market with more than 5M EVs sold over past 5-6 yrs. These cars will start making their way into the used car market by 2024-2025 and by 2027, about XX% of used car market will be occupied with EVs.

     

    Electrical Vehicle Supply Equipment& Installation (EVSE) 

    • Dealers should offer free installation of charging equipment or provide some incentives for the customer buying an EV and compensate for lost service and maintenance and additional time for sales activity.

    Transaction Type

    • For Used EVs, The True Health Of The Battery May Not Be Properly Disclosed By Some dealers
    • Due To This Reason Majority Of Customers Purchase The EVs From Franchised And Used Car Dealers That Are Specialized With Sales Of Electric vehicles

     

     

    Region Wise 

    POLAND 

    In 2021, approx XX Million cars were imported

    In Poland About 42% of used cars sold in Poland were imported from Germany and about 44% of them were more than 10 Years old. Volkswagen, Opel and Ford accounted for -31% of used car brands imported in the country. As of 2022, the majority of the used cars coming to Poland are still private imports bought at an average price of under €5,000. Many of the imported cars have more than 60K miles on the odometer, without concrete paperwork and often in poor shape and hence lower transaction prices.

     

    ROMANIA

    • In 2021 Approx 400K Used Cars Were Sold In Romania

    During 2016-2022 – The share of cars at prices below EURO 3000, has dropped, whereas the share of cars at prices above EUR 15000, have gone up.  Greek technology platform for used cars Spotawheel entered Romania in 2021 and established the Romanian branch – Autosp Rom at the beginning of November 2021

     

    As of May 2022, Spotawheel is competing with Autovit, for developing a marketplace  starting from being the online extension of the physical used car market in Bucharest. 

     

    SLOVAKIA 

    The used car policy in Slovakia is conductive for lower taxation on older vehicles and as a result the average age on used cars sold in the country is among the highest in Europe.  In 2021, 62k used cars were imported in the country,  Over the past 2 years, the average ticket size per car has risen by around 11-14% in the last year, in the under three year segment the increase is over 20% . 

     

    EUROPE USED CARS MARKET SEGMENTATION

    The Europe Used Cars Market can be segmented into following categories for further analysis.

    By Product Re Usage

    • Remanufacturing Process
    • Scraping
    • Rental Services
    • Showcasing and Museum Purposes
    • Re Buying Purposes

     

    By Product Sales Conveyance

    • Online Sale
    • TV Marketing
    • Social media Marketing Platform
    • Online Auction
    • Platform based sales – OLX etc.
    • Direct Purchase

     

    By Class of Propulsion

    • Electric Vehicle
    • Hybrid Vehicle
    • Fossil Fuel Vehicle
    • Specialized Fuel Vehicle
    • Gas Based Vehicle

     

    By Age Classification of Usage

    • Children
    • Youth
    • Adolescents
    • Adults
    • Middle Aged
    • Elders and Senior Citizens

     

    By Regional Classification

    • Austria
    • Belgium
    • Bulgaria
    • Croatia
    • Republic of Cyprus
    • Czech Republic
    • Denmark
    • Estonia
    • Finland
    • France
    • Germany
    • Greece
    • Hungary
    • Ireland
    • Italy
    • Latvia
    • Lithuania
    • Luxembourg
    • Malta
    • Netherlands
    • Poland
    • Portugal
    • Romania
    • Slovakia
    • Slovenia
    • Spain
    • Sweden

     

    RECENT TECHNOLOGICAL TRENDS IN USED CARS MARKET

    The used car industry has risen in size and significance over the last decade and is expected to do so in the future. A successful used car strategy by manufacturers and dealers is becoming increasingly important to their businesses and is increasingly acknowledged as such.

     

    New and used car sales are inextricably linked; used sales influence residual values and new vehicle price, as well as customer connections and brand strength. In summary, used car sales have a huge impact on many areas of an automaker’s sales and should not be overlooked.

     

    There have been some core  strategies being implemented  that  are essential  for  growing dealers’ used  vehicle  sales in the European Market in the recent years which includes Enhance the customer experience from the Internet to the showroom on a continuous basis, rationalize client relationships through CRM, perfect online promotion and merchandising efforts to reach opportunities and existing clients, manage inventory and pricing with network-wide IT solutions, maximize high-margin sales opportunities, and optimize certified used vehicle programmes.

     

    In European markets, successful used vehicle dealers and manufacturers make deliberate investments in technology to improve customer experiences and establish trust, which forms the foundation of their capacity to compete with lower-priced independent dealers and private sellers.

     

    To get a clearer idea of the whole market operability in terms of higher sales in European markets, the recent integration of technology must be followed by the integration of a branded OEM Dealership.

     

    The emphasis has been on incorporating this value-added service into the Union’s used automobile market.

     

    Customers in cities would be more inclined to use OEM-affiliated branded dealerships. The online portals had no discernible market share. Customers appear to have sought information on the internet but completed the sale in a real dealership.

     

    It should also be noted that when incorporated directly into a non-branded platform dealership, the identification of a consumer who transacted in a conventional dealership rather than a web portal is significantly lower. As a result, it is possible that there is some prejudice against purchasers on the internet.

     

    IMPACT OF CHIPS SHORTAGE AND RUSSIA AND UKRAINE WAR ON EUROPE USED CARS MARKET

     

    Due to a shortage of processors and other components, Mercedes-Benz AG and Volkswagen AG have had to cut back on manufacturing, and the lack of new cars is trickling down the market, putting even more pressure on consumers already dealing with high inflation.

     

    Used car prices in Germany — The largest vehicle market in Europe increased. Due to a scarcity of vehicles, secondhand car prices in Germany have reached new highs.

     

     Despite production snarls, supply-chain concerns have upended decades of automobile economics, with manufacturers reaping large profits. The key to success is growing prices. The increase in used vehicles also helps by improving the value of leased cars.

     

    The crisis in Ukraine is putting additional strain on supply networks, with automobile manufacturing forecast to remain below pre-pandemic levels this year.

     

    As the epidemic puts a strain on the supply of chips for new vehicles, used-car vendors in the UK are seeing a surge in demand.

     

    The rising demand for old vehicles demonstrates how the COVID-19 crisis is affecting consumer behaviours around the world due to supply-chain shortages of essential components like as processors. And this is a boon to people who are getting rid of old autos.

     

    Because there are so few new cars being built and delivered, there is a big shortage of new-car stock, which is driving a lot of demand into the used-car market.

     

    According to Motorway, the Vauxhall Agila and Ford Focus, as well as the Aston Martin Vanquish, were the best-selling cars, followed by the Volkswagen Eos. Tesla’s Model S followed several other models in price increases during the past year, reaching 14 percent.

     

    During the global semiconductor shortage, demand for used cars in Europe is surging. Car costs in Denmark have risen in the recent year. People are more interested in buying newer used cars because there are such long lines for new autos. This also signifies that the used car mark has nearly been cleared.

     

    The recent surge in used vehicle sales is the result of extraordinary demand caused by long delivery delays for new cars. Due to a lack of semiconductor chips, manufacturers are unable to produce the latest models rapidly enough, with some vehicle companies citing year-long wait times for specific models.

     

    The increased speed with which shops are selling cars reflects the strong consumer demand.

     

    Due to a shortage of processors and other components, Mercedes-Benz AG and Volkswagen AG have had to cut back on manufacturing, and the lack of new cars is trickling down the market, putting even more pressure on consumers already dealing with high inflation.

     

    Used automobile prices in Germany, Europe’s largest auto market, have risen. Despite production snarls, supply-chain concerns have upended decades of automobile economics, with manufacturers reaping large profits. Mercedes-Benz announced last week that its first-quarter revenue increased by 8% despite shipping fewer automobiles. The key to unlocking the mystery is to look at growing costs.

     

    The increase in used vehicles also helps by improving the value of leased cars.

     

    The crisis in Ukraine is putting additional strain on supply networks, and automobile manufacturing is anticipated to remain below pre-pandemic levels this year due to the disruption. If demand stays strong, prices are likely to remain high.

     

    Inflation in Germany unexpectedly rose to its highest level since records began in the early 1990s after the country’s reunification. The basket of products used to calculate Germany’s inflation rate includes secondhand autos.

     

     

    EUROPE USED CARS MARKET COMPETITIVE LANDSCAPE

     

    The maturity of the used automobile market varies greatly by nation and geographical proximity. France and Germany, which operate under the same European legal framework in terms of automobile distribution, have strong national heritage in the automotive sector and create brands with global reach.

     

    Germany has the most sophisticated online used automobile market, which is extensively used by both vendors and buyers. In Germany, used automobiles already have the longest warranty of any market.

     

    As a result, certified automobiles do not provide a significant competitive advantage in this market. Dealers’ share of the used car market has been rebounding in recent years after a six-year decline.

     

    Third-party listing services that include many images, full descriptions, and car history records to reassure used vehicle buyers have made it simpler for customers to sell automobiles of various ages on the private market.

     

    Furthermore, franchised dealers in the EU Nations are coming under increased pressure from the independent dealer market, where new businesses such as CarMax are retailing more of the late-model automobiles previously offered by franchised dealers.

     

    German shoppers were far more inclined to utilize independent e-tailer sites. In Germany, up to half of used car purchasers intend to use independent e-tailer sites for their next purchase, compared to only a quarter of French used car customers.

     

    Automotive publications have been further integrated into this information source so that Europeans may utilize them as part of the basic needs.

     

    Although eBay Germany entered the market later than expected, eBay Motors U.S. bought one of the largest online classifiers in Germany – mobile.de – and has emerged as a prominent competitor in Europe.

     

    It is also one of the causes for the expansion of the German secondary market. eBay Germany currently has an inventory that is more than four times greater than that of eBay America.

     

    The Aramis Group, which operates under the four brands Aramisauto, Cardoen, CarSupermarket, and Clicars in France, Belgium, the UK, and Spain, respectively, is a market leader in Europe for the online sale of used cars.

     

    They are able to have a complete understanding of the market, customer expectations, and needs thanks to the data-driven approach supported by proprietary technology and digital tools.

     

    EUROPE USED CARS MARKET COMPANIES PROFILED

     

    Sl no Topic
    1 Market Segmentation
    2 Scope of the report
    3 Abbreviations
    4 Research Methodology
    5 Executive Summary
    6 Introduction
    7 Insights from Industry stakeholders
    8 Cost breakdown of Product by sub-components and average profit margin
    9 Disruptive innovation in the Industry
    10 Technology trends in the Industry
    11 Consumer trends in the industry
    12 Recent Production Milestones
    13 Component Manufacturing in US, EU and China
    14 COVID-19 impact on overall market
    15 COVID-19 impact on Production of components
    16 COVID-19 impact on Point of sale
    17 Market Segmentation, Dynamics and Forecast by Geography, 2021-2026
    18 Market Segmentation, Dynamics and Forecast by Product Type, 2021-2026
    19 Market Segmentation, Dynamics and Forecast by Application, 2021-2026
    20 Market Segmentation, Dynamics and Forecast by End use, 2021-2026
    21 Product installation rate by OEM, 2021
    22 Incline/Decline in Average B-2-B selling price in past 5 years
    23 Competition from substitute products
    24 Gross margin and average profitability of suppliers
    25 New product development in past 12 months
    26 M&A in past 12 months
    27 Growth strategy of leading players
    28 Market share of vendors, 2021
    29 Company Profiles
    30 Unmet needs and opportunity for new suppliers
    31 Conclusion
    32 Appendix

     

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