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Following January as record trading month for WeBuyCars, with similar figures shown for October and November 2020, CEO Faan van der Walt says this points to a resilient and defensive used vehicle market.
“Our January sales figures were 10% up on the same period in 2020, and despite the prevailing economic climate, there has been a strong recovery in used vehicle sales as evidenced by our strong figures between October and November last year.”
38% of South Africans rely on personal vehicles for transport, and South Africa’s vehicle parc (the overall number of vehicles in circulation in the used and new car market) is growing despite a drop in sales of new vehicles. According to Naamsa (the National Association of Automobile Manufacturers of South Africa), the Covid-19 pandemic resulted in new vehicle sales declining by almost 33% in 2020, taking levels back to those last seen in the 2000s. New vehicle sales for December 2020 were down 10,1% compared to December 2019.
Van der Walt says several factors influence WeBuyCars’ trading results: used vehicle sales are more demand driven and are more affordable than new vehicles, and consumers are increasingly questioning new vehicle prices which are rising sharply above inflation despite a sales slump.
“Disposable income is under strain and more consumers are opting to trade down from new to used vehicles. Covid-19 has heightened consumer preference for online sales platforms, and we have seen a 21% year on year increase in online traffic.”
“The upside of the Covid-19 pandemic is a clear indication that that our business model, driven by artificial intelligence and lead generation, is relevant in this environment. Buyers have access to full vehicle condition disclosure and instant offers are based on data and analytics rather than buyer sentiment with sellers receiving an immediate cash settlement. Allied to this, 35% of our sales are now online, including our online vehicle auctions which have been running online exclusively, since 2020.”
WeBuyCars is seeing similar patterns replicated across vehicles bought from sellers and sold to buyers. At present, both buyers and sellers are keen on smaller cars such as Volkswagen Polo and Polo Vivo, Ford Fiesta and Figo models and Toyota Corollas. There is also interest in BMW 3-series and Mercedes-Benz C Class sedans, and Toyota Fortuner, Hilux and Ford Rangers continue to be popular choices.
While there are similar patterns across stock with the most leads, WeBuyCars is also seeing strong interest in Hyundai i120, BMW 1 Series and Audi A4 models.
“Consumers across our seller and buyer base continue to look for a combination of value, reliability and quality. It’s interesting that supply and demand mirror each other, and we believe we will continue to see similar trading patterns over the next few months,” van der Walt says.