Leading British auto vertical Auto Trader has launched beta testing with retailer partners for a guaranteed trade-in tool for its marketplace.
Auto Trader says the product, which will fully launch in early 2021, is part of its aim to digitalize more parts of the car buying process and to help dealers with the challenges of Covid-19 by providing dealers with better qualified buyers and “a more profitable way to source stock”.
Its research of Auto trader consumers found 73% said they would be more likely to visit a dealership if they had a guaranteed part-exchange agreed in advance. The same survey found 29% of deals broke down over part-exchange negotiations.
It also gives consumers a guaranteed trade-in price for their current vehicle. The price will be underwritten by Manheim Auction Services, part of Cox Automotive U.K. using Auto Trader’s own valuation and current auction data. This reduces the risk for dealers because if the vehicle doesn’t match their stock requirements they can dispose of the car using the underwritten disposal service. The car will be paid for and collected from a retailer’s forecourt within five days.
It works in a similar way to Kelley Blue Book which is owned by Cox Automotive. They purchase the car immediately and take on all the risk. Consumers answer a series of questions to ascertain the car’s condition to get a guaranteed trade-in price then send their details to the dealer to progress the trade-in and purchase as long as the car is as described. The product will initially be accessed from a dealers’ advert but will expand across the Auto Trader platform.
“Sourcing stock effectively remains a real challenge for many dealers,” said Karolina Edwards-Smajda, Auto Trader’s Commercial Product Director.
“They’re either having to overpay through constrained traditional channels, competing for shrinking stock, or worse, missing out on potential sales opportunities driven by the exceptional demand in the market.
“We wanted to create a solution that not only makes the process more efficient, but also keeps the stock among dealers and helps boost their profitability.”
Earlier this month Auto Trader launched Top Spot, a premium product that lets retailers display their logo review rating and up to six new and used vehicle images on a carousel and an online learning center for retailers.