Carwow losses rise to -£29.6m amidst sector turbulence.

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【Summary】Carwow, an online car marketplace, experienced a challenging year with pre-tax losses doubling to £29.6m, while turnover increased by 9% to £39.9m. The company attributed the losses to various factors, including the fallout from the Ukraine war, rising energy prices, inflation, interest rate hikes, and a decline in consumer confidence. However, Carwow continued to expand its business in the UK, Germany, and Spain and made significant investments in its Sell My Car service and YouTube channel.

FutureCar Staff Oct 10, 2023 4:18 PM PT

Carwow losses rise to -£29.6m amidst sector turbulence.

Last year, Carwow experienced a challenging period, with pre-tax losses increasing by 119% to £29.6m, despite a 9% growth in turnover to £39.9m.

Throughout the year, the company expanded its operations in the UK, Germany, and Spain. However, it noted that the market deteriorated after a strong first quarter. According to the accounts filed at Companies House, Carwow attributed this decline to the fallout of the Ukraine war, which caused rising inflation, central bank interest rate hikes, and a significant drop in consumer confidence.

In addition to expanding its business, Carwow focused on developing its Sell My Car service and increasing its YouTube presence. The UK channel saw a 20% increase in subscribers, reaching a total of 7.8 million.

Carwow's CEO, John Veichmanis, acknowledged the turbulent year for the automotive industry as a whole, stating that global factors affected Carwow as well. However, he highlighted the company's strategic investments in broadening its offering to customers and partners, including the development of the Sell My Car service and investments in the OEM media product. Veichmanis emphasized that these decisions have had a transformational impact and positioned Carwow for a successful 2023.

Carwow's performance in 2023 has shown significant improvement, with a dramatic increase in revenues and profitability. The company is forecasting revenues to surpass £50m for the year, a notable increase from the previous year's £39.9m. Carwow aims to establish itself as the leading online destination for individuals looking to change their cars.

The number of dealers on Carwow continues to rise, and the platform has seen a record level of investment from OEMs who choose to promote their new products through Carwow. The group's monthly profitability has significantly improved in 2023, and the UK business has already reached break-even. Carwow maintains a strong cash position and is making strategic investments to drive sustainable growth across all markets.