BuyaCar’s Austin Collins argues that predicted UK new car sales dip will boost online sales in 2017

New figures released by online motor retail platform BuyaCar.co.uk reveal a 41% increase in sales during 2016 compared with the previous year.

Now at BuyaCar we predict that pressure on new car sales in 2017 is likely to increase the proportion of online sales through third parties.

The biggest surges came during the usual heavy new car activity periods but performance was consistently up on 2015 right through to December.

The pattern over the year suggests that dealers are increasingly smart in their use of online-only motor retail partners to help meet ever steeper manufacturer registration targets and to assist in moving on large numbers of part-exchanges. Used cars sold on behalf of dealers accounted for around 90% of BuyaCar’s 2016 sales total.

We believe the figures reflect an industry-wide trend, which is backed up by data on consumer attitudes confirming that reluctance to complete the entire car purchase process online is fast disappearing.

In a recent survey of more than 800 car buyers 31% reported that they were now more likely to consider buying entirely online than they used to be.

March and September saw increases in sales of 32% and 34% respectively, with overall growth for the year of 41% driven by larger rises in some other months. For example, January saw an increase of 97% over the same period the year before.

Because 2017 is expected to bring inflationary pressures and economic uncertainty BuyaCar expects to see dealers throwing the net wider to try to capture sales from further outside their own geographical areas. In 2016 the average delivery distance from the originating dealer for a car supplied through BuyaCar was 150 miles.

Dealers are expected to feel the pressure this year as car price inflation forces them to work harder for sales.

The SMMT themselves have confirmed that the new car market could move back by five or six per cent this year but that will probably likely to lead to further growth in online sales as dealers look to win sales from further afield.

So, even if the new car market sees negative growth this year, we expect online sales to continue rising.

Austin Collins is managing director of BuyaCar.co.uk