The signs in the used car market are pointing to change: after years of falling prices, there are signs of a clear ...
The signs in the used car market are pointing to change: after years of falling prices, there are signs of a clear trend reversal. As current data shows, demand for used cars is rising again, while supply is not keeping pace sufficiently. The statistics platform Statista reports that new registrations of ownership increased by around 10% in October 2024 compared to the previous month. A year-on-year comparison also shows strong growth: in October 2024, 12% more used cars changed hands than in the same month last year and even 30% (!) more than in October 2022.
While there is still a gap between customer budgets and advertised prices in the used e-car market according to an analysis by AutoScout24, Deutsche Automobil Treuhand (DAT) and other market analysts are reporting rising residual values, particularly for combustion vehicles.
These developments represent a decisive opportunity for car dealers: Targeted price adjustments can optimise margins and secure competitive advantages. But how can this be done efficiently and strategically? The answer lies in digital price labelling.
3 REASONS WHY DYNAMIC PRICING STRATEGIES ARE CRUCIAL NOW
We are convinced that car dealerships should respond to the current market dynamics by proactively adapting their pricing strategies.
#1 HIGHER MARGINS FROM RISING DEMAND
The used car market is currently experiencing a rare constellation: a relatively short supply meets high demand. As the icing on the cake, long waiting times for new cars can also mean that more and more potential buyers are also considering used cars. This gives car dealerships the opportunity to realise higher margins if they reconsider their current prices.
The best approach? Data-driven pricing that finds its way to the POS as dynamically as possible.
#2 CUSTOMER SATISFACTION THROUGH TRANSPARENCY
Online and offline are increasingly merging into one world. Nowadays, customers expect a seamless connection between what they see online and what they see in the dealership. More and more people are researching online before making an ‘offline purchase’ and then comparing prices. To avoid a loss of trust, prices between the website and the dealership should therefore be identical at all times.
With analogue price labelling, this becomes a Sisyphean task as the size of the fleet and the number of locations increase. Digital price labelling such as D.A.D., on the other hand, makes it possible to automatically synchronise prices on all channels.
#3 TIME? CRITICAL.
In June 2024, used car prices rose by an average of 0.2%, although the start of the summer is traditionally characterised by slightly declining prices. Those who have reacted slowly or not at all to this increase have clearly missed an opportunity to improve their margins. The fact that time has become a significant competitive advantage is one of the biggest developments in the digitalisation of the automotive industry: today, the race to the top can only really be won by those who act in real time.
HOW DIGITAL SYSTEMS ARE THE KEY TO SUCCESS
The recent rise in prices and high demand are just one current example: Time and again, the modern used car market requires quick action on the supply side. The focus here is on price optimisation, which can now keep pace with market developments in a completely different way thanks to digital price labelling than would have been the case in the purely analogue sector a few years ago.
THE EFFICIENCY AND SPEED OF DIGITAL PRICE LABELLING
Traditional price labelling is not possible without tedious manual processes that are repeated over and over again: print price sheet, search for key, search for car, place price sheet. Not only is this time-consuming, but like any repetitive task, it is also a source of errors.
Our Digital Auto Display (D.A.D) can solve all these problems in one fell swoop. Via a cloud-based platform, prices can be updated at the touch of a button - regardless of whether the fleet comprises 10 or 10,000 cars. All of this happens in real time, both on site and on the website. This eliminates duplication of work, delays and the risk of incorrect entries.
FLEXIBLE AND AGILE IN THE HIGHLY COMPETITIVE AUTOMOTIVE MARKET
When the market is volatile, the ability to adapt quickly becomes your biggest advantage over the competition. There is more to our D.A.D than just the real-time implementation of price adjustments - you can also make changes from any location, which are immediately displayed in your dealership.
Prices can also be changed for individual vehicles or entire fleets, for example to reduce remaining stock or to make particularly popular vehicles more expensive. If you notice that demand is increasing specifically for SUVs with combustion engines, for example, you can use the digital system to increase the prices of all models in your inventory that fall into this category within a few minutes. Without having to interrupt sales processes or tie up staff.
CONCLUSION: AN INDISPENSABLE TOOL FOR THE MODERN USED CAR MARKET
The current market dynamics offer car dealerships a great opportunity to optimise their pricing strategies and secure a competitive advantage. Digital price adjustment systems such as the D.A.D help to capitalise on this opportunity - through speed, transparency and flexibility. They are not only a means to increase efficiency in internal work processes, but also a strategic tool to revolutionise your strategy, delight customers and maximise margins.
Now is the time to find out more about our Digital Auto Displays, take advantage of the benefits of digital solutions and actively shape the transformation of the used car market.
