An update from our CEO Nathan Coe

The long-awaited roadmap for our exit from the latest lockdowns in England and Scotland has now been confirmed with details on the roadmaps for Northern Ireland and Wales expected soon. The good news is that we will be fully opening physical forecourts to buyers again within weeks and can have some confidence that this time they will stay open. We are already hearing positive sentiment from many retailers about what the coming weeks will bring in terms of both volumes and margins. This news should enable us all to move forward and to start building our businesses for a new future, combining the best of the digital capabilities we are working with you to build, and the forecourt retail experience.

Current trading

Once again, the market has remained robust throughout this lockdown period and stronger than we had expected given the strong "stay at home" message from the government. Although there’s some continued pressure on supply, this lockdown has had less impact on demand than previous lock downs. Our latest proxy sold data suggests that most recent trading is around 75% of usual volumes[1]. This is huge credit to the efforts of retailers who should feel incredibly proud of their response and how they have embraced new ways of working.

Last week, there were 15.2 million visits to Auto Trader, which is an increase of over 10% on the same period last year and consumers spent a total of 139.6 million minutes on the marketplace, up 4.4% year-on-year[2]. We continue to see pricing reaching all-time highs following 10 months of growth with prices up c. 6.5% so far in February3.

With this context, and following our February free period[4], we will be charging as planned in March. We are confident that the next month will see continued growth in sales for retailers through Click & Collect and home delivery as buyers are increasingly active. We are also hopeful the other regions will follow Scotland and allow forecourt visits for Click & Collect and that we’ll see a relaxation in rules around test drives.

The news about fully re-opening physical forecourts for all customers, means this is the critical time to showcase all of your stock online, to both maximise online sales opportunities now and to ensure that those consumers who are waiting to purchase can begin to make those buying decisions. We know April sales come from consumers searching in February and March and with the additional impetus from the plate change we can expect this to be even more pronounced this year. Our marketing investment will support this as we continue our activity across TV, video on demand, radio and digital channels to significantly increase awareness ahead of April.

Looking to the future

There is no doubt that some of the consumer behaviour changes we have seen will remain beyond the pandemic and that buyers will increasingly be looking to complete more of the journey online. We’re supporting you with this, and your retailer store is now live showcasing your business. We’ve also shared the changes to how admin fees will be displayed, an important step in our journey to digital retailing where full price transparency will be critical.

This week also sees the next stage in our Guaranteed Part-Exchange journey with the move from the pilot phase to full launch and availability to all retailers. We are seeing not only high-quality leads from engaged buyers with a significantly higher conversion rate, but also the introduction of an essential tool for retailers to manage part-exchanges, avoiding the lost sales you’ve told us are one of your biggest challenges.

Our long-term partnership

Now is a great time to ensure you are set up to fully realise the opportunities that the next few months will bring and we’d recommend you talk to your Account Manager to review your advertising. We have seen so many examples of retailers embracing the changes this crisis has demanded and have seen real business benefits as a result. You can continue to find helpful insight through our market insight tools and on trade.autotrader.co.uk and if you, or anyone in your team, needs further training or support you can access our retailer performance masterclasses through our e-learning platform.

We can now look forward to the remainder of the year with a renewed confidence and optimism. I have no doubt there will be challenges still to come, although we very much hope they are in equal part opportunities as the industry accelerates its digital transition. We are committed to building and sustaining a partnership that takes us beyond this crisis and to the future of automotive retailing, which we look forward to working on with you.

Data sources & references

1. Sales proxy data based on the levels of stock removed from Auto Trader.
2. Auto Trader internal analysis of Google Analytics data, average number of unique advert views daily and time spent on site, 15th – 22nd February 2021 vs 15th – 22nd February 2020 (inclusive).
3. Auto Trader Retail Price Index, year-over-year pricing has been above 6.5% since w/c 24th August 2020 until 22nd February 2021 (like for like pricing)
4. View full terms here