Dealers get online sales shelter from the Covid storm

While the headline new car sales figures show a 25 per cent fall in so far this year to 86,870, a major contributor is the collapse of the hire-drive market.

Traditionally responsible for 16 per cent of new car registrations, sales to the rental companies are down 84 per cent. In terms of actual metal, that’s a drop from 18,352 last year to just 2,914 in 2020.

In contrast to the 84 per cent fall in rental registrations and falls of 30 per cent in commercial and fleet sales, the 9.6 per cent drop in sales to private buyers seems less extreme, particularly given the backdrop of closed showrooms and a biting recession.

Part of the protection for dealers has come from the growing trend of buyers towards online purchases. According to Brian Cooke, SIMI director general: "With car showrooms closed for the next number of weeks due to Government Covid-19 restrictions, retailers have been enhancing their online presence, particularly with the month of November being the key selling period for forward orders for the new registration plate in January."

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While most dealers find potential buyers do their pre-purchase research online these days, the final act of showroom purchase and physical test drive remains a trait of the Irish car buying routine. However, dealers are focusing more of their attention to online sales and whether the entire transaction can now be carried out remotely.

Home delivery

Irish dealer group, Windsor Motors has previously reported that its research shows 86 per cent of car buyers do at least half their vehicle research and shopping online and that 42 per cent of buyers are willing to buy their next car online.

Keary's, the Cork-based dealer group which represents the likes of BMW, Nissan, Hyundai, and Renault earlier this year set up a fully-online sales system. Cars can be viewed online, sales staff are taking Skype and Zoom calls, and vehicles can be delivered, fully sanitised, to a customer.

The online sales format includes a seven-day “cooling off” period in which it will collect a car if the customer is not happy with it.

In an interview with Autocar this week, Bill Berman, chief executive of the Pendragon dealer group, which is the third largest in the UK by turnover said: "By mid-May we were delivering 100 used cars a week, all bought digitally."

According to Berman: “Between 16 and 19 per cent of our Car Store sales are with home delivery and no physical interaction with the store in any way.”