Dealers see consumer uncertainty and stock availability as key 2020 challenges

Dealers see consumer uncertainty and stock availability as key 2020 challenges

Liam Quegan

More than two thirds of dealers consider consumer uncertainty and the availability of suitable stock to be the biggest challenges they face in 2020, according to the latest NextGear Capital sentiment survey.

Around one in five dealers also cited achieving margin in an increasingly competitive market as a key challenge to overcome in the year ahead.

Despite the surge in demand for Alternative Fuelled Vehicles (AFVs), less than one in ten dealers saw AFVs as a major challenge in 2020. Interestingly, despite the decreasing demand for diesels, none of the dealers surveyed saw this as an issue.

In response to these key challenges, the majority of dealers said they planned to invest in their businesses throughout the year to overcome them. More than half of the dealers said they would invest in additional stock and marketing and social media tools to help sell that extra stock. Around a third planned to invest in infrastructure to support AFVs on their forecourt, while one in ten planned to invest in wholesale funding to enable business expansion.

Liam Quegan, NextGear Capital Managing Director, said: “With the UK only recently exiting the EU and now facing the threat posed by the Coronavirus, it’s not surprising to see dealers highlighting consumer uncertainty as a major challenge in 2020.

“The Coronavirus brings with it a large degree of economic uncertainty, certainly within the short term, and adds another variable to the challenges dealers currently face within the market. There are also various market factors putting pressure on stock availability and dealers are therefore right to recognise that they will have to work hard to source the right stock at the right price.

“Stock will always be the basis of any dealer’s business and it’s therefore encouraging to see dealers planning to invest in additional stock and marketing and social media tools to help shift those extra units. It represents a positive response to concerns about stock availability and shows that dealer confidence is fairly high as we go into the first quarter of the year.

“The plan to invest in AFV infrastructure and wholesale funding to enable business growth are also further signs of the positive approach being adopted on the forecourt to face the challenges in the market.”

Latest from Cox Automotive

4th June, 2020

Stock profile plans highlight the need for data and insight

How are dealers are changing their stock profiles and why is accurate market data and insight is needed now more than ever?

Read more
3rd June, 2020

Regit - Future consumer attitudes towards EVs

Regit shares their recent research into future consumer attitudes towards EVs.

Read more
1st June, 2020

Dealer sentiment survey

Nine in ten dealers will not be cutting their used car prices as they begin to re-open for face-to-face trading....

Read more
15th May, 2020

KPMG COVID-19 impact infographic

KPMG’s automotive advisory team have produced an infographic concisely illustrating the impact of COVID-19 on the automotive retail sector.

Read more
More articles