The six months also saw revenue jump 37 per cent to $332 million as Carsales extended its market leadership in Australia and benefited from similar market strengthening in two of its key offshore interests, Brazil (revenue up 23 per cent) and Korea (up 12 per cent).

Carsales group CEO Cameron McIntyre said the company was continuing to increase the digitisation of vehicle buying and selling and integrating finance into the product portfolio. 

“We are seeing excellent adoption of our digital trade-in products in ‘Instant Offer’ and ‘Dealer Direct’ and good levels of consumer demand in our key markets,” he said.

Cameron McIntrye

“The inventory is approaching pre-pandemic levels – this growth in inventory is driving demand for dealer premium and depth listings. This all gives us confidence that Carsales is in a strong position to deliver outstanding shareholder returns in FY23.”

Mr McIntyre told GoAutoNews Premium that used-car volumes in Australia were continuing to rise and are getting closer to pre-pandemic levels. 

“As used-car inventory and the time it takes to sell a car normalises to pre-pandemic levels, sellers are going to need to start selling again as consumers have more choice when it comes to car buying,” he said.

“When it comes to price we have seen prices rise considerably over the past two years by more than 40 per cent for used cars across both private sellers and dealers. 

“Since September last year we have seen price stabilise but we are yet to see any material pressure on prices to come down. 

“Assuming supply and demand continues to gradually normalise and there are no shocks to either (of those factors), my view is that prices may moderate a little over the coming months but it’s hard to see any larger steps up or down in used car pricing from here at the moment.”

But he said Carsales saw no link between the recent interest rate rises and consumer decisions about buying a vehicle.

“We haven’t seen a noticeable connection between consumer buying intent and those interest rate increases,” Mr McIntyre said.

“Traffic to the Carsales site, lead volumes overall and the time it’s taking to sell a car continue to track ahead of pre-covid market conditions.

“We think the reasons for this are that there has been a backlog in consumer demand that hasn’t been fulfilled as a result of supply shortages in both new and used cars which is still being met.

“At these interest rate levels the cost of servicing a car loan is still low enough for consumers to absorb the additional funding cost.

“Consumers may also be making substitution decisions when it comes to their car purchases ie; used for new or reducing their budgeted spend to cater for the rising funding costs but they are still buying.”

The half year also showed that growth was driven by record dealer subscriptions and large increases in inventory levels.

It noted that yield was supported by a “strong uptake of new product ‘Lead Amplifier’ further demonstrating excellent value proposition for dealers.”

Dealer revenue was $94.6 million – up 10 per cent – for the half year while private revenue was up 39 per cent to $43.9 million.

Globally, Carsales had 2.2 million vehicles listed online in the period; 48,000 subscribed dealers; had nine-billion page views by customers; and delivered 11 million dealer leads.

The contribution to the financials made by US marketplace platform Trader Interactive was not underestimated.

The business, for which Carsales finalised the acquisition of the remaining 51 per cent of in September last year, contributed $115.4 million to revenue in the half, up 21 per cent on the previous corresponding six months.

Carsales said that the result showed good growth across RVs, powersports and equipment. 

Asked by GoAutoNews Premium if there was an opportunity to expand the business into the car market, Mr McIntyre said ‘no’.

“Trader Interactive owns commercialtrucktrader.com which has around 178,000 truck listings on its site,” he said.

“When it comes to cars, though, the company has no plans for entering that part of the market in the US.”

By Neil Dowling