eBay Motors Group has said that dealers may have to “work their marketing harder” to reach car buyers earlier and maintain leads until potential customers are ready to buy.
The advice comes after its research showed February’s used car market revealed that the impact of higher than usual levels of online buyer activity was dampened by a softening of conversion to lead rates.
Motors.co.uk reached a four year high in browsing sessions across both February and January, but eBay Motors Group expressed concern over consumer uncertainty with the high level of online visits not immediately flowing into leads.
Lucy Tugby, marketing director at eBay Motors Group, said: “Matching supply to consumer demand remains a challenge for dealers, although the continued strength of pricing is helping many to conserve their margins.
“Buyers are in the market but with increased pressure on their household budgets they are understandably driven by price and affordability, we can see this in the high volumes of searches for older cars in the 6–14-year-old bracket. Many will also be hedging their bets to see if prices come down.
“As we head into spring, dealers may have to work their marketing harder to reach consumers earlier and maintain the conversation for when they are ready to buy.”
Average stock volumes dropped for the second month in a row from 55 to 51 cars, their lowest level since October 2022, according to eBay Motors.
Car supermarket inventories were hit the hardest with volumes down 16% to 336 units, a month-on-month (MoM) shortfall of 62 units, followed by franchised dealers dropping 11% from 85 to 76 units. While independent sites remained unchanged at 33 units.
However, the shortage of stock meant prices, tracking at historically high levels, remained stable, dipping just 0.6% MoM from £19,262 to £19,152 – still 4% up year-on-year.
Strong demand for used vehicles, compounded by ongoing supply restrictions in the new car market, have driven growth in retail prices across the board last month.
Depleted stock levels also prompted a small improvement in days to sell with cars averaging 40 days on forecourts, compared to 42 in January.
The February Market View also shows a small year-on-year rise (YoY) in the number of electric vehicles (EVs) being stocked by dealers.
In February EVs accounted for 5% of all dealer listings, up from just 1% in February 2022. While hybrids more than doubled their YoY share from 3% to 7%.
Although petrol remains the most popular fuel choice, accounting for 49% of all listings, followed by diesel (40%), their share continues to be slowly eroded by electric and hybrid alternatives.
The industry realignment of advertised prices in the used EV sector continued with some notable MoM drops for some Hyundai Ioniq, Jaguar I-Pace, Nissan Leaf and Renault Zoe models.
“The volatility in used EV pricing continues, leaving many dealers with little choice but to wait and see how it plays out. Likewise, buyers aware of the price drops, will also be biding their time,” said Tugby.