The move follows an urgent meeting organised by the VACC CEO Geoff Gwilym and the VADA in the lead-up to the Christmas holiday break. The meeting with Carsales CEO Cameron McIntyre and Michael Holmes, the executive director – dealers at Carsales was organised in just 24 hours and was attended by dealers from all over the state via Zoom.
The meeting was run by VADA chairman Sid Cetindag of the Gasmak Motor Group and Nick Strauss, owner of the Berwick Motor Group.
GoAutoNews Premium was told that the dealers were responding en masse to notices that Carsales will raise its prices to dealers on February 1, 2021.
The increases include:
- A $2 increase on used, new and demo leads
- A $5 increase on all pay-per-listing ads
- A $5 increase to all self-serve promote products
- A four per cent increase on packages and promotion bundles
- Compression of the duplicate credit window to seven days from 14 (This approximates to 1200 leads per month that will not be credited).
An attempt by the VADA to have the price increase postponed was unsuccessful.
VADA held further meetings with key Carsales operational and executive staff with a view to securing greater operational efficiencies for dealers who continue to use the platform and the meetings were said to have been “positive”.
Members of the inaugural Carsales-VADA Dealer Advisory Board (DAB) are:
- Adam Sawicki – (Bay City Auto Group)
- Emma De Ruiter – (Carworks Ballarat )
- Daniel McKenzie – (Gasmack Group)
- Sue Alford – (Stillwell Motor Group)
- Rob Parisi – (City Bus and Truck Centre)
- Paul Hopper/James Sounas – ( Hopper Motor Group)
- Srecko Lorbek /Ilija Cicak – (Lorbek Luxury Cars)
- John Buskes – (A1 Motorcycles)
- Rod Ayoubi /David Strapp – (Servco Group)
The board will convene on January 29, 2021.
In addition to the advisory board, Carsales and the VADA have created a dealer ‘issues register’ to register, track and address problems dealers might be having with site functionality, duplicate leads and various other concerns dealers are experiencing when using the site.
The issues identified by dealers are to be collated by VADA and put to Carsales via the advisory board. According to a dealer bulletin to members, issues that have been included in the initial issues register include:
- Autogate functionality
- Quality of leads, including fake leads, repeat leads or leads for non-available stock
- System functionality with regards to data search filters
- Opting out of interstate accessibility
- Credit processes and rules
Dealers have told GoAutoNews Premium that now was not the time to be increasing prices with Victoria only just out of lockdown.
They said that dealers were preparing unexpected headwinds in the first quarter of 2021 as the phase-out of JobKeeper may potentially put private and business buyers under pressure right at the time the Carsales’ fee increases are planned to kick in.
Dealers said Carsales’ monthly invoices were the biggest invoices dealers have to pay and they thought an increase in fees of about four per cent was excessive when CPI was up only 1.6 per cent. But Carsales said that IT people costs were blowing out by four per cent.
GoAutoNews Premium has confirmed with others across the IT industry that IT labour costs across many sectors were getting out of hand.
Some dealers say that if their Carsales invoices kept going up, it would get to the point where dealers would look harder at investing in their own websites in order to reduce their reliance on Carsales.
Dealers say Carsales was running at only around 130,000 units in mid December and that it was once twice that number.
Dealers said that if they limited the number of cars they listed as a result of the price increases, that number of listings could fall and Carsales would run the risk of no longer having the most cars for sale in the online market.
Mr Gwilym told GoAutoNews Premium: “Dealers tell me they have a number of issues, but the price per lead they are paying and the quality of those leads is paramount in their minds.”
By John Mellor
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