Post-lockdown second-hand car market is booming
Unlike new car sales, the second-hand car market is booming. In June, the number of registrations rose by 22% compared to the same period in 2019 in Belgium. The lockdown seems to have reinforced the shift to second-hand cars.
“The recovery has been very slow. In May, the decline was still more than 31%. But in June, the market clearly overheated,” says Filip Rylant, spokesman for Traxio. The federation represents sales and after-sales services in the Belgian automotive sector.
All the players confirm
It’s a reboot that Cardoen‘s CEO still finds hard to believe. “From day one, May 11th, we had 50% growth compared to the previous year. We thought it wasn’t going to last, that it was just customers who hadn’t been able to buy during the lockdown. But it didn’t stop, we ended June with a 59% increase,” says Ivo Willems in the newspaper Le Soir.
Soco, another major player in the sector, also did well in June. “We had a very good month. It got off to a normal start, but sales picked up at the end of the month. We met our objectives,” explains Frédéric Vassamillet, the company’s sales manager.
Online as well, customers and sellers were particularly active. “It really exploded. You can see that people started looking again after the lockdown. And in June, it continued, since we did more than 31% more than in June last year,” rejoices Vincent Hancart, managing director of AutoScout24.
This is all the more surprising given that the new car market is still at half-mast. The number of new car registrations in June remained almost 2% below last year’s level. According to Traxio, a number of customers prefer second-hand cars due to a lack of confidence. Or they have financial reasons, like a decrease in their purchasing power, or cautiousness about their financial future.
Then there is the abandonment, probably temporary, of other means of transport. “Many people have decided not to travel by plane, but to spend their holidays in their own country or in a neighboring country, so they needed a car,” says Filip Rylant. For the time being, people prefer individual transport to public transport.
Another element that visibly supports the second-hand figures is the success of “almost new” models. That is Cardoen’s business model, but in the current context, dealerships also have stocks that they want to get rid of.
“We can see that they don’t hesitate to put on sale vehicles that are currently in their showroom, that are in their stock, in order to sell them as quickly as possible. It’s a sales model that interests them more and more,” notes Vincent Hancart.
Customers also benefit. “People are less willing to wait. Consumers are so used to instantaneity. We find a bit of this mode of consumption in the car business. The trend is not limited to the lockdown period, it was already observed before, but it has become more pronounced during the crisis.” The lockdown forced manufacturers to stop building cars, so waiting times for new vehicles have also increased.
But how will the market evolve? For the moment, all hypotheses are open. One thing is certain, everyone remains very cautious about the future, about the possibility of a new lockdown and about the economic situation.
For the year as a whole, the figures for the automotive market are still gloomy. No one expects the losses to be fully recovered. Traxio expects new car sales to fall by 30% and used car sales by 19%. This would mean a market of 600 000 used cars compared to 700 000 last year. New car sales are also expected to be significantly lower.
Traxio estimates that the current overheating will be limited in time. And few professionals in the sector allow themselves to be more optimistic. “We should not forget that we have lost three months of sales figures, which we will probably not make up for,” says Ivo Willems.