Supermarkets face greater stock shortages than independent or franchised dealers

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【Summary】Supermarkets are expected to be hit harder by stock shortages than independent or franchised dealers. The shortage of cars aged three to five years old, resulting from low new car sales, will have a significant impact. Supermarkets, whose stock is mostly in this age bracket, will be the most affected. Some supermarkets have already responded to the shortage by closing outlets and anticipating a dent in profits. Motorpoint has also announced a halt in further expansion.

FutureCar Staff Sep 15, 2023 9:19 AM PT

Supermarkets face greater stock shortages than independent or franchised dealers

Supermarkets are expected to be the hardest hit by stock shortages in the upcoming year, according to Rachael Jones, the director of automotive finance at Auto Trader. Speaking at a recent conference on the future of automotive finance, Jones explained that supermarkets would suffer more than independent or franchised dealers because they primarily deal with cars that are three to five years old.

This age bracket of vehicles is currently experiencing a shortage due to the low sales of new cars in recent years. The impact of this shortage is significant, with a projected 39% decrease in available stock compared to 2019. As a result, supermarkets, whose stock mostly falls within this age range, will be the most affected by this change.

The effects of the stock shortage are already being felt in the market. Peter Vardy, for example, has announced the closure of two CARS outlets and expects a dent in profits in 2022 due to the lack of stock. Similarly, Motorpoint has put a hold on further expansion as a result of the shortage.