Used Car ReMarketing

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Used Car ReMarketing

  1. 1. USED CAR REMARKETING Bora Selcen Duvan Renault / B & LCV Segment Product Manager E-mail: bora.duvan@renault.com.tr Dr. D. Selcen Ö. Aykaç Ozyegin University / Post-Doc Research Fellow E-mail: selcen.aykac@ozyegin.edu.tr Prepared from Bora Selcen Duvan’s MBA Graduation Project, which is completed in 2008 at the Istanbul Bilgi University under the supervision of Dr. D. Selcen Ö. Aykaç as an advisor.
  2. 2. Although used car sales represent two or three times the volume of new car sales, there are very few studies that fully explore the used car business. Dr. D. Selcen Ö. Aykaç
  3. 3. • Used-to-new vehicle ratio • 2.4 (1999) 2.6 (2007) • • Profit margin in used vehicle sales 1.2% (1999) 2.7 (2007) • ≈ 10% profitability in the complimentary used vehicle financing and insurance businesses Dr. D. Selcen Ö. Aykaç
  4. 4. Used Vehicle vs. New Vehicle Market (x1,000) UK US France Germany Italy Canada Spain Japan New 2,567 16,995 2,070 3,320 2,262 1,583 1,517 5,852 Car Sales Used 7,701 44,138 5,400 6,650 4,587 2,300 2,081 5,985 Car Sales Used / 3.0 2.6 2.6 2.0 2.0 1.5 1.4 1.0 New Dr. D. Selcen Ö. Aykaç
  5. 5. Definition of • a used motor vehicle is to be understood as being one which has previously been registered • any motor vehicle that has previously been registered is a used motor vehicle • unregistered cars when subject to private consumption tax are then become registered and counted as used car Dr. D. Selcen Ö. Aykaç
  6. 6. MARKET • Private sales • Remarketed those in which buyer the sale of vehicles by and seller are both companies that had private individuals used them in the course of business or to generate revenue Dr. D. Selcen Ö. Aykaç
  7. 7. the MARKET for by Akerlof information asymmetry or ? occurs when the seller knows more about a product than the buyer Owner of a good used car will be unable to get a high enough price to make selling that car worthwhile. Therefore, owners of good cars will not place their cars on the used car market. Dr. D. Selcen Ö. Aykaç
  8. 8. global used car market • $819.52 billion (2003) • 1999-2003 compound annual growth rate 4.2% Dr. D. Selcen Ö. Aykaç
  9. 9. Europe Used Cars Market Year Units Million % Growth 2003 27.3 2004 27.7 1.6 2005 27.8 0.3 2006 28.3 1.8 2007 (e) 28.7 1.5 CAGR, 2003-2007 1.3 Dr. D. Selcen Ö. Aykaç
  10. 10. used cars market ≈ 1.5 M vehicles per year 50% : independent traders 40% : C2C 10% : manufacturers Dr. D. Selcen Ö. Aykaç
  11. 11. Independent Traders Dr. D. Selcen Ö. Aykaç
  12. 12. C2C Dr. D. Selcen Ö. Aykaç
  13. 13. Manufacturer Network Channel Dr. D. Selcen Ö. Aykaç
  14. 14. Auctions Dr. D. Selcen Ö. Aykaç
  15. 15. Who is the Used Car Ultimate Consumer ??? Dr. D. Selcen Ö. Aykaç
  16. 16. Used Car Buyer
  17. 17. Turkish consumers look for • Affordable price • Satisfactory vehicle history report • Originality (no accident) • Originality (unpainted) • Vehicle integrity • Low mileage on the odometer • Good mechanical condition Dr. D. Selcen Ö. Aykaç
  18. 18. Types of Consumers • Frequent vehicle changers (Whimsicals): tends to buy used car thinking that new cars will loose more of its value than used cars • Vehicle as an investment tool (Investors): used car doesn’t loose its value as much as new car, even it’s a kind of investment, it makes money while selling • Business vehicle owners (Misusers): vehicles depreciate more as a result of business use, then why buy new while there are cheaper old ones • Accessory valuers: it is much more economical to buy a used car with additional accessories at market price • High quality brand buyers (Prestige Seekers): luxury/premium brand followers with limited purchasing power Dr. D. Selcen Ö. Aykaç
  19. 19. Thanks Dr. D. Selcen Ö. Aykaç 19

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