AutoBrief: Why is it good to be a used car dealer in 2023?

Why is it good to be a used car dealer in 2023?

By Tomaž Kavčič


In the automotive sector, the majority assesses 2022 mainly through the prism of poor deliveries, long waiting times, near-zero inventories, crazy high prices and also higher profits. New car salespeople have benefited the most, but 2023 is a winning trend in the hands of used car salespeople.

In this blog, we present the reasons why, which are mainly focused on the predictions of many analysts who look at the used car market from different sides.

Closures during the COVID-19 pandemic have created an interesting situation – all manufacturers have produced fewer cars than originally planned, so supply has declined sharply around the world. As a result, all vehicles produced could be sold at a profit.The big discounts that were common in the automotive industry vanished overnight, and new car dealers took in record profits.

On average, new cars went up by 31%, while used cars went up by only 16%. In 2023, we can expect prices to start to falling, but there is no way to expect a return to the old days.

Why can you be optimistic?

The forecast for 2023 is that the supply of cars is likely to be higher than it was in 2022. Discounts on petrol and diesel cars are also expected to increase, while electric cars are in danger of falling out of demand (more on the reasons at the end of the article). However, most analysts predict a small increase in new car sales in Germany, but a decline in sales in France, England, Italy, and Russia.

In the case of used cars, the trend is on average three years behind, and the number of used vehicles available on the market in 2023 and 2024 will be lower, which means higher prices for at least two more years. Analysts predict that in 2024 the market will see a significant drop in used vehicle prices due to the stabilization of the stock of new vehicles. To sum up the findings of many analysts, they are convinced that used vehicle dealers will do well. It will be necessary to overcome problems with the purchase of cars, but you have already become quite accustomed to this in recent years ????

Our research (all findings are available in three parts here) also shows that more than 77% of buyers who will buy in the next six months want to buy a used car. This trend will not change for at least another year, as even those who plan to buy a car over a period of one year are more than 70% fond of used vehicles.

Various consultants have emphasized the importance of digital advertising in the automotive market for several years, and this year is no exception.If you are not there, someone else will overtake you and secure a market share that could be yours. That is why, as so many times today, we encourage you to at least try our help in this area. (This is available here.)

Beware of Electric Vehicles

In 2022, records from the segment of sold electric vehicles were reported from most countries, but subsidies for the purchase of electric vehicles are decreasing as of January 2023, especially in Germany, which is a very important market for Slovenia, and electricity prices are rising.. Forecasts for 2024 in Germany predict a half-decrease in electric vehicle sales, as people prefer gasoline or diesel for both reasons.

This is also well illustrated by our research among those buying vehicles in the next six months. The fuel with the highest share among propulsion types is gasoline, the second is diesel, and only then come both combinations of electric drives, which together have a 26% share.

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