IN THIS fourth edition of Dealer Talks, our new podcast series brought to you by Gumtree Cars, in partnership with GoAutoMedia, we explored car finance and car subscriptions for dealers on the Road to Recovery
Car finance is an area of dealer operations that has seen significant turmoil in the past couple of years with changes to sales commission structures, with stricter responsible lending rules and less appetite for loans from the bank lenders. Now there is the pandemic.
And now car subscriptions are an additional revenue model for dealers particularly with those customers who are in an uncertain financial situation right now.
We talked to Mark Lancaster, the CEO at DealerCell and to Chris Noone, the CEO of Carly.
Mark Lancaster, who operates a finance loan approvals software platform for dealerships shared insights on the ebbs and flows of how the dealer finance market is performing.
He explained they were seeing some dealers achieve 65 per cent finance penetration by getting a finance quote at the start of the sale. Other dealers who continue to do the finance deal at the end of the process were stuck on about 32 per cent penetration.
Chris Noone talked about how subscriber sales are an alternative to dealers selling their stock and that dealers get regular payments while companies like Carly do all the logistics for them. Dealers are also being introduced to buyers who may not normally visit a dealership and they are becoming the contact point in the collection and changeover of cars.
We heard that financing enquiries are running at record levels and so are people signing up for subscriptions.
If there is a challenge it will be what the last quarter looks like as Government assistance is wound back and the situation in Victoria washes through the national economy.
By Neil Dowling