“Welcome to the latest Market Insight Overview from Cox Automotive.  Every month, we provide automotive industry professionals with unique intelligence, supported by invaluable insight and market sentiment from our customers, that goes beyond the headlines to uncover what’s driving the new and used car sectors from wholesale, retail and funding perspectives. We hope our holistic analysis arms you with the essential knowledge needed to navigate the fast-paced, ever-changing automotive market.” PHILIP NOTHARD Customer Insight & Strategy Director - UK

1. Market Insight Overview
February 2019
P H I L I P N O T H A R D
C u s t o m e r I n s i g h t & S t r a t e g y D i r e c t o r - U K

2. Cox Automotive
Market Overview
“Welcome to the latest Market Insight Overview from Cox Automotive.
Every month, we provide automotive industry professionals with
unique intelligence, supported by invaluable insight and market
sentiment from our customers, that goes beyond the headlines to
uncover what’s driving the new and used car sectors from
wholesale, retail and funding perspectives. We hope our holistic
analysis arms you with the essential knowledge needed to
navigate the fast-paced, ever-changing automotive market.”
PHILIP NOTHARD
Customer Insight & Strategy Director - UK

3. Agenda
• Retail
• Wholesale
• Funding
• Outlook

4. RETAIL

5. Retail
February results published by the SMMT showed that new cars registrations rose 1.4% following the January
dip, while the impact of WLTP, ULEZ and legislation changes around diesel vehicles continue to influence the
fuel landscape
45%
36% 29% 44% 35% 30%
43%
32%
45%
31%
44%
32%
43%
32% 43%
32%
40% 30%
40%
29%
39% 32% 38% 32% 38% 30%
51%
59%
64%
52% 61% 65%
53%
63%
51% 64%
52% 62%
53%
62%
52%
62%
55% 62%
55%
64%
56%
61%
57%
61% 57%
64%
4%
6% 7%
4% 4% 6%
4%
5%
4%
6%
4% 6%
4%
7%
6% 7%
5%
8%
5%
7%
5% 7%
5% 7% 6%
6%
174,564
163,615161,013
83,115 80,805 81,969
562,337
474,069
152,076
167,911
186,265192,649
243,454234,945
161,997163,898
76,433
94,094
426,170
338,834
158,192153,599
163,541158,639152,473144,089
0
100,000
200,000
300,000
400,000
500,000
600,000
2017 2018 2019 2017 2018 2019 2017 2018 2017 2018 2017 2018 2017 2018 2017 2018 2017 2018 2017 2018 2017 2018 2017 2018 2017 2018
January February March April May June July August September October November December
Registrationvolumes
New Registrations - fuel type % share
Diesel Petrol AFV

6. Retail
Consumer confidence index edged from a 5-year low in the previous month ahead of market expectations of
-15 as new car registrations rise 1.4% year-on-year
-5 -6 -6 -7 -5 -10 -12 -10 -9 -10 -12 -13 -9 -10 -7 -9 -7 -9 -10 -7 -9 -10 -13 -14 -14 -13
2.9%
-0.3%
8.4%
-19.8%
-8.5%
-4.8%
-9.3%
-6.4%
-9.3%
-4.6% -5.0%
-14.4%
-6.3%
-2.8%
-15.7%
10.4%
3.4%
-3.5%
1.2%
23.1%
-20.5%
-2.9% -3.0%
-5.5%
-1.6%
1.4%
-25.0%
-20.0%
-15.0%
-10.0%
-5.0%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
(16)
(14)
(12)
(10)
(8)
(6)
(4)
(2)
0
Jan-
17
Feb-
17
Mar-
17
Apr-
17
May-
17
Jun-
17
Jul-17 Aug-
17
Sep-
17
Oct-
17
Nov-
17
Dec-
17
Jan-
18
Feb-
18
Mar-
18
Apr-
18
May-
18
Jun-
18
Jul-18 Aug-
18
Sep-
18
Oct-
18
Nov-
18
Dec-
18
Jan-
19
Feb-
19
NewCarRegistrations(%YoY)
ConsumerConfidence
Consumer Confidence Index vs. New Vehicle Registrations
Consumer confidence index new vehicle registrations

7. Retail
Two-thirds of respondents reported in the February Monthly Market Survey* an increase in footfall and online
activity compared to the same period last year, while 71% confirmed they had seen increased demand
*State of the market dealer survey February ‘19
65%
69%
12%
38%
71%
19%
12%
7%
67%
12%
5%
43%
23%
24%
21%
50%
24%
38%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Physical Footfall activity compared to last year?
On-line activity compared to last year?
Retained margins compared to last year?
Finance penetration compared to last year?
Retail/consumer demand compared to last year?
Stock availability compared to last year?
Increased/Better Declined/Worse About the same

8. Retail
Constraints on supply and positive demand in February for used cars produces encouraging results in the
February Monthly Market Survey* as in excess of 70% of dealers report a decrease in overage and days in
stock for used cars
82%
52%
7%
7%
0%
27%
71%
74%
18%
21%
21%
19%
0% 20% 40% 60% 80% 100% 120%
New Cars - Consignment stock
New Cars - Overage
Used Cars - Days in stock
Used Cars - Overage
Increased Decreased About the same
*State of the market dealer survey February ‘19

9. Retail
In a time of uncertainty, 1 in 4 dealers remains positive over the economic condition over the coming months
whilst 56% report in the February Monthly Market Survey* that they expect it to decline
23%
56%
21%
What are your expectations for economic
conditions over the coming months?
(as a proxy for demand)
Improving Declining About the same
9%
53%
37%
What are your expectations for sourcing used
vehicles over the coming months?
(as a proxy for supply)
Improving Declining About the same
*State of the market dealer survey February ‘19

10. RETAIL
• Constraints on supply and positive demand in February for used cars produces encouraging results on
February Monthly Market Survey as in excess of 70% of dealers report a decrease in overage and days in stock
for used cars
• The headwinds faced in the new car market causes stocking concerns in certain areas, as 52% of dealers cited
overage had increased in the February Monthly Market Survey and 4 in 5 reported an increase in consignment
stock
• Dealers cite a very positive view, as over two-thirds report in Februarys Monthly Market Survey an increase in
footfall and online activity compared to the same period last year whilst 71% indicate demand had improved
• Margin compression continues to trigger concern for dealers in February, as 67% indicate a decline compared
to 2018
• In a time of uncertainty, 1 in 4 dealers remains positive over the economic condition over the coming months
whilst 56% report in the February Monthly Market Survey that they expect it to decline
• In the February Monthly Market Survey, half of the dealers expect sourcing stock over the coming months be
worse than last year whilst 37% cite they expect it will improve
Summary

11. WHOLESALE

12. Wholesale
The wholesale market remained buoyant in February, with strong buyer interest and good auction conversion
rates
February
‘18
£7,160
February
‘19
£6,131
£-
£1,000
£2,000
£3,000
£4,000
£5,000
£6,000
£7,000
£8,000
£9,000
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Averagewholesaleprice(allvehicles)
Auction Wholesale Price
2018 2019

13. Wholesale
Figures show that fleet car values increased by 4.9% month-on-month, while the average value for part-exchange
vehicles fell by £300 to £4,082£4,161
£4,369
£4,173
£4,082
£4,325
£4,411
£4,046
£4,125
£4,086
£3,990
£4,088
£4,359
£4,271
£4,459
£10,249
£9,795
£11,354
£10,277
£10,880
£10,979
£11,134
£11,208
£12,056
£10,631
£10,456
£9,964
£10,257
£10,252
£0
£2,000
£4,000
£6,000
£8,000
£10,000
£12,000
£14,000
2018 2019 2018 2019 2018 2018 2018 2018 2018 2018 2018 2018 2018 2018
January February March April May June July August September October November December
Auction Wholesale Prices
Part Exchange Fleet

14. Wholesale
Diesel and petrol average selling prices in wholesale eased in February, the lowest seen in 7-months with the
averages remaining stable at £7,687 (Diesel) and £4,461 (Petrol)
Diesel Petrol
Hybrid Electric
Wholesale Used Prices by Fuel Type
£4,543 £4,483 £4,445 £4,423 £4,772 £4,379 £4,184
Aug '18 Sept '18 Oct '18 Nov '18 Dec '18 Jan-19 Feb-19
Petrol
£8,258 £7,867 £7,702 £7,488
£8,078
£7,328 £7,089
Aug '18 Sept '18 Oct '18 Nov '18 Dec '18 Jan-19 Feb-19
Diesel

15. WHOLESALE
Summary
• Manheim recorded an average selling price of £6,131, up 0.5% month-on-month with fleet car values
increasing by 4.9% month-on-month, while the average value for part-exchange vehicles fell marginally by
£300 to £4,082
• Dealer-Auction.com reported that the average selling price remained on par with January at £5,017. The
trade-to-trade online auction platform also recorded an 8% year-on-year increase in average values, however,
this is likely to be the result of a change in the stock mix
• Interest in retail-ready vehicles remained high, and cars at Grade 1 and 2 regularly achieved the CAP Clean
value. On the other side of the coin, vehicles in poor condition and those offered without a V5 attracted low
levels of buyer interest
• Vehicle condition could, in part, explain the price trends we’ve reported for fleet vehicles, which tend to be
offered at a consistently high standard
• Looking ahead to March, it’s likely that the market will soften as auction volumes increase, and vehicle
condition and documentation will become ever more important as buyers look to achieve a quick return on
their investment

16. FUNDING

17. Funding
The wholesale stock funding business recorded an average cost per unit of £7,568, down 1% month-on-
month and an 8% increase on February 2018
February
‘17
£6,803
February
‘18
£7,009
February ‘19 £7,568
£6,000
£6,500
£7,000
£7,500
£8,000
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Average Cost of Unit (£)
2017 2018 2019

18. Funding
Average holding days funded increased 3 days YoY with a minor decrease of 4 days from January 2019
February ‘17
60
Dec, 53
February
’18
60
February
’19
63
30
35
40
45
50
55
60
65
70
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Average Holding Days
2017 2018 2019

19. Funding
An overwhelming 74% confirmed they were happy with their average days to sell being between 30
and 60 days. However, 11% of those with average days to sell of 30-60 days report being dissatisfied
9%
74%
4%
0%
11%
2%
0% 10% 20% 30% 40% 50% 60% 70% 80%
Yes – average days to sell is 30 days or less
Yes – average days to sell is between 30 and 60 days
Yes – average days to sell is over 60 days
No – average days to sell is 30 days or less but should be quicker
No – average days to sell is between 30 and 60 days but should be quicker
No – average days to sell is over 60 days but should be quicker
Are you satisfied with the speed at which you are able to convert the used vehicles you buy into a sale?
*State of the market dealer survey January ‘19

20. Funding
The average age of funded units reduced marginally from the 6.6 years in 2018 to 6.2 years, while the
average mileage remained stable at 62,482
February 2018
6.6 years
Ave. Age Funded
61,980
Ave. Mileage
February 2019
6.2 years
Ave. Age Funded
62,482
Ave. Mileage

21. OUTLOOK

22. Retail Outlook
Our viewpoint – 2019 the retail market
Dealers investing in PPC
advertising to drive sales
as consumers turn to
online for their next
vehicle
Increasing appetite for
Manufacturers and
Dealers to embrace
eCommerce
Demand grows for
advanced vehicle
imagery solutions to
drive online buyer
confidence

23. Wholesale Outlook
Our viewpoint – 2019 the wholesale market
Demand for retail-ready
stock will drive efficiencies in
vehicle services, assisted by
enhanced imagery
Buyers will expect increased
transparency to drive stock
confidence, leading to more
detailed vehicle descriptions
and assurance checks
An increasingly agnostic
approach to physical and
digital sales streams will
emerge to complement
changing buyer behaviours

24. Funding Outlook
Our viewpoint – 2019 the funding market
A strong appetite for growth
means cash flow remains a
priority for dealers
Ease and flexibility
remains key for dealers
An increased focus on
digital integration is helping
dealers to purchase stock
hassle free from a variety
of sources

25. PHILIP NOTHARD
Customer Insight & Strategy Director – UK
Philip.Nothard@CoxAuto.co.uk
@PhilipN_Auto
@coxautomotiveUK
THANK YOU
/PhilipNothard
/CoxAutomotiveUK
/philipnothard
/cox-automotive-uk