Electric vehicles (EVs) are emerging as the most profitable and fastest-selling used cars, according to industry leaders speaking at The Road Ahead event. Nathan Coe, CEO of Autotrader, highlighted that careful inventory management is critical to dealer profitability, warning that poor choices can be among the costliest mistakes for dealerships.
Autotrader data indicates that brand loyalty is waning in the new car market, particularly for EVs. The UK market now features 75 car brands, up from 45 in 2019, intensifying competition. “Brand loyalty has really, really shifted. That’s strange for us,” Coe said. “It’s good for competition. It means you can sell them into other products. But it’s a double-edged sword.”
Ashley Passant, managing director of the car and van division at Greenhous Group, explained that the company is diversifying its offerings to shield against market volatility. Greenhous has expanded into the fleet market and opened a Shrewsbury town centre location in a former Waitrose, designed as a low-pressure environment staffed by product experts rather than salespeople.
The dealership has added Chinese brand franchises and maintains a 50/50 split between established and new entrant brands, reviewing its portfolio every six months. “They’ve got huge volume aspirations, and I don’t doubt that they’ll meet them,” Passant said of new entrants.
Craig Strike, operations director at Group 1 Automotive UK, emphasized the unprecedented pace of change in the automotive sector. “You need to ensure you don’t lose customers to other brands. Not all OEMs can achieve the numbers they’ve set out,” he said. Drawing lessons from the US, Group 1 prioritizes aftersales, which accounts for almost 50% of its UK gross margin. “Aftersales needs to be seamless for customers. You’ve got to try stuff. There will be some stuff that works and some that doesn’t. If you don’t try, you’ll never know,” Strike added.
Greenhous is also leveraging local fleet opportunities, as organisations often lack a clear route for vehicle disposal at the end of the lifecycle. This allows dealers to reclaim vehicles for the used car market. “Successful retailers will be the ones that diversify,” Passant concluded.
