Aston Barclay group managing director Martin Potter has told AM that some OEM and fleet auctions at the business may stay digital spurred on by success during the lockdown.
The auction company managed to get back up and running less than two weeks after March 23 with digital auctions running for clients through its e-Live and e-Xchange platforms by April 3.
Potter said: “We stayed open when others closed during lockdown and that’s a testament to how we have invested in our digital capabilities over the last few years.
“I can’t see why we would return to doing physical auctions for OEM and fleet stock in the future.
“For fully maintained stock under three and a half years old, the inspection process, images and description makes it so there is very little risk in keeping that process digital for vendors and for buyers.”
Potter said there will still likely be physical auctions for older age budget vehicles where inspections in person might be more necessary.
Aston Barclay has facilitated some physical auctions after lockdown, but these have been invitation only and because its sites are large enough that social distancing can be easily maintained.
All those visiting Aston Barclay’s six locations have to pre-register for track and trace purposes.
Potter said Aston Barclay’s lockdown trading has helped the business win a trial with Volkswagen Financial Services as a potential new client and it has also won business with an 11,000 unit 90% volume deal with leasing company Zenith. It has also won recent contracts with Mercedes-Benz and Motability.
A V-shaped recovery
While Aston Barclay’s volumes are down year-to-date due to the lockdown, the business still managed to sell 12,000 units between April and June.
This is about one third of the typical numbers for that period, but given the vast majority of dealers were closed during this time, it meant Aston Barclay was able to help vendors still needing to dispose of stock.
Key worker sales, van sales for the logistics industry and dealers that had online sales capabilities all kept volumes going during that three month period.
Aston Barclay is now back to holding several sales a week, with volumes at around 3,000 to 4,000 units a week and Potter is confident the company will be back on track to where it should be by the end of the year.
Potter is aware of the pressures facing Q4, but has been encouraged by the strength of the used car market so far, including how prices have held up.
Potter also isn’t overly concerned about a flood of vehicles being handed back by those bailing out of company car agreements or when PCP contract extensions come to an end.
He said: “I think the extensions the Financial Conduct Authority (FCA) have put in place will help spread the return of PCP stock over a three to four month period.
“From our perspective we’ve seen a V-shaped recovery and any drop in consumer demand will be replaced by retailers turning to the used market.
“I’m a glass half full kind of person and I know people are worried about the furlough scheme ending and the potential for a second wave.
“But I can’t see a dramatic realignment of used car prices like there was in May 2019 like others have predicted.
“There may be a softening, but it’s not going to be a horrible realignment.”
Potter acknowledged there had been a shortage of part-exchange stock going through the auctions, but Potter said this started coming through around a week after showrooms reopened in June.
He said there has been a slight softening of the budget used car market, but it’s not an area he’s overly concerned about.
Potter confirmed that Aston Barclay remains acquisitive, but it’s likely to be on the lookout to buy companies that can further enhance the business’ digital capabilities, rather than physical locations to expand its bricks and mortar footprint.
He added: “We’re always looking and in discussions with companies that can add additional functionality to our digital products.”