With the evolution of the fleet remarketing sector set to accelerate, Aston Barclay has highlighted the need for operators to employ different tactics to keep stocking days and conversion rates at acceptable levels.
The observation is part of Aston Barclay’s special Used Market Insights Report – The Evolving Fleet Market 2016-2019 produced for the British Vehicle Rental & Leasing Association (BVRLA) which highlights significant change within the fleet market over the past three years and forecasts more to come.
The report shows how with annual new car registrations greater than 2.6 million during 2015 and 2016, and average fleet replacement cycles currently running between 41 and 42 months, significant change within the remarketing fleet sector is likely within the coming years as greater volumes of vehicles return to market. The result of which, according to Aston Barclay, will impact prices and, therefore, require different tactics from vendors to keep stocking days and conversion rates at an acceptable level.
‘From the beginning of 2016 to end of May 2019, fleet prices increased by £1,937,’ explained Martin Potter, group managing director, Aston Barclay. ‘This continued price inflation has impacted on the buying habits of dealers across the board as they have sought alternative stock profiles and at a different price point. The knock-on implications of this changing buyer behaviour are that prices within the late and low sector, and young part exchanges have also increased.’
Aston Barclay puts much of the market evolution simply down to organic, market dynamics but suggests Brexit and, more specifically, WLTP has accelerated the rate of change.
Martin said, ‘Today, the market continues to evolve to meet the changing dynamics at play - cap hpi’s recent downward market alignment is testament to that. At the same time, the late and low sector continues to establish a ‘natural’ replacement cycle rhythm as manufacturers come back into the rental markets, and the dealer – young part exchange market is an area that sees increased activity from sourcing dealers and retailers.’
Catering for this change in the market, Aston Barclay’s strategy of ‘connecting customers to cars and driving the future of remarketing’ provides a mix of digital and state-of-the-art physical remarketing channels.
Martin continued, ‘Clearly, the fleet market is evolving, and vendors need to ensure they evolve with it to ensure the greatest return on their assets.’