A high-level helicopter view of the current ‘state of the market’ from across the Cox Automotive UK business - identifying industry trends and key messages.

1. Market Overview
May 2018
Philip Nothard - Head of External Relations

2. T H E V E H I C L E L I F E C Y C L E
Who we are
Cox Automotive

3. AGENDA
• Retail
• Wholesale
• Funding
• Dealers
• Outlook

5. Retail
May illustrated continued appetite for Petrol and AFV whilst overall volumes exceed 2017 by 3.4%
45% 36%
44% 35%
43%
32%
45% 31%
44% 32%
51%
59%
52% 61%
53%
63%
51% 64%
52% 62%
4%
6%
4% 4%
4%
5%
4%
6%
4% 6%
174,564
163,615
83,115 80,805
562,337
474,069
152,076
167,911
186,265 192,649
0
100,000
200,000
300,000
400,000
500,000
600,000
2017 2018 2017 2018 2017 2018 2017 2018 2017 2018
January February March April May
Registrationvolumes
New Registrations - fuel type
Diesel Petrol AFV

6. Retail
The average sold price of vehicles increased by 3.7% from April to £13,373. Diesel and petrol prices increased 12.6% and 23.3%
May ‘16
£12,286
May ‘17
£12,875
May ‘18
£13,373
£9,000
£10,000
£11,000
£12,000
£13,000
£14,000
£15,000
January February March April May June July August September October November December
Averageadvertisedprice
Retail Used Car Price Performance
(as listed on Motors.co.uk)
2016 2017 2018

7. Retail
Days in stock increased across all sectors, with MPV suffering the toughest YoY increase by 6 days
34
44
41
35
38
32 32 32
39
35
34
37
47
44
38
39
35
36
38
41
39
37
0
5
10
15
20
25
30
35
40
45
50
4x4 Convertible Coupe Estate Large Lower Medium Medium MPV Prestige Small Supermini
Numberofdays
Retail days in stock May ‘17 vs. ‘18
(as listed on Motors.co.uk)
May-17 May-18

8. Retail
Diesel stock levels achieve parity with petrol vehicles following 7% fall in volume YoY
Vehicle Views
May ‘18– 51% of total
May ‘17– 52% of total
Stock Volume
May ‘18 – 50% of total
May ‘17– 57% of total
Days in stock
May ‘18– 39 days
May ‘17– 37 days
Diesel Petrol Hybrid ElectricHybrid
Stock Volume
May ‘18 – 48% of total
May ‘17– 42% of total
Stock Volume
May ’18 – 1% of total
May ‘17– 1% of total
Stock Volume
May ‘18– 0.22% of total
May ‘17– 0.26% of total
Vehicle Views
May ‘18– 0.95% of total
May ‘17– 1% of total
Vehicle Views
May ‘18– 47% of total
May ‘17– 47% of total
Vehicle Views
May ‘18– 0.32% of total
May ‘17– 0.39% of total
Days in stock
May ‘18– 37 days
May ‘17– 33 days
Days in stock
May ‘18– 44 days
May ‘17– 31 days
Days in stock
May ‘18– 48 days
May ‘17– 51 days

9. Retail
The data – Summary
Retail
• Dealers are better managing their diesel stock to meet consumer demand
following negative headlines over emissions
• There is now a balance between petrol and diesel listed vehicles, with dealers
buying less diesel stock and setting more appealing price points for consumers
• Alternatively fuelled vehicles continue to struggle compared to diesel and petrol
• Supermarkets selling 7 days slower YoY, with independents and franchises
managing more stable stock turn (avg. 2 days slower)
• All car segments selling slower year-on-year with consumer demand slightly
higher for smaller vehicles

11. Wholesale
Average auction wholesale prices increased 12.6% in May YoY and out of seasonality increased 0.3% since April
May ‘16
£5,470
May ‘17
£5,906
May ‘18
£6,649
£4,500
£5,000
£5,500
£6,000
£6,500
£7,000
£7,500
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Averagewholesaleprice
Auction Wholesale Price
2016 2017 2018

12. Wholesale
Diesel prices throughout the wholesale market remain stable with a slight increase of 1.24% in the £10 - £20k banding
£-
£5,000
£10,000
£15,000
£20,000
£25,000
£30,000
£35,000
£40,000
£45,000
£50,000
£0k to £5k £5k to £10K £10k to £20K £20k to £30K £30k to £40K £40k to £50K
Averagewholesaleprice
Diesel Wholesale Used Prices May ’17 vs. ‘18
2017 2018

13. Wholesale
Petrol wholesale prices remain stable with easing slightly in the £20 - £30K and £40K - £50K
£-
£5,000
£10,000
£15,000
£20,000
£25,000
£30,000
£35,000
£40,000
£45,000
£50,000
£0k to £5k £5k to £10K £10k to £20K £20k to £30K £30k to £40K £40k to £50K
Petrol
Averagewholesaleprice
Petrol Wholesale Used Prices May ’17 vs. ‘18
2017 2018

14. Wholesale
One in five dealers use a stocking plan whereas only a tiny minority (4%) use bank finance
74%
4%
20%
2%
0%
10%
20%
30%
40%
50%
60%
70%
80%
Own capital Bank or other interest-based finance Stocking plan (i.e. non-financial product) Credit Card
%respondents
How do you typically finance auction purchases?

15. Wholesale
85% dealers retain at least 1 in 4 part-exchanges for resale
15%
56%
7%
22%
0%
0%
10%
20%
30%
40%
50%
60%
>25% 26 - 49% 51 - 75% 76%+ None
%respondents
Percentage of part exchanges retained for resale

16. Wholesale
Wholesale
The data – Summary
• The average sold price for both ex-fleet and part exchange vehicles remained on
par with April (£6,649), and up 12.6% on May 2017 (£5,906)
• Wholesale volumes increased in May, up 7.3%, with a clear growth in vehicles in
the £10-40k price brackets (up 25.6% year on year)
• 13% year on year increase in volumes and an average sale price increase of £510
to £4,440 through Dealer Auction, the trade-to-trade online auction platform,
proving that the adoption of digital bidding is gaining pace

18. Funding
A 7% increase in average cost per unit compared to the same period in 2017, equalling those seen in 2016
May ‘16
£7,194
May ‘17
£6,707
May ‘18
£7,194
£6,000
£6,500
£7,000
£7,500
£8,000
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Averagecostofunit
Average Cost of Unit (£)
2016 2017 2018

19. Funding
Average holding days also increased to 57 from 55 in April, returning to the figures experienced in the same period in 2017
May’17
57
May ‘18
57
45
50
55
60
65
70
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Averageholdingdays
Average Holding Days
2017 2018

20. Stock
funding
Funding
In May ‘18 the average age funded, and mileage remains in line with ‘17 May figures
May 2017
6.4 years
Ave. Age Funded
60,393
Ave. Mileage
May 2018
6.2 years
Ave. Age Funded
61,522
Ave. Mileage

22. Dealers
Three in five dealers surveyed reported margin pressures. In addition, over half indicated footfall had worsened compared to 2017*
25%
45%
15%
30%
30%
21%
52%
28%
60%
20%
60%
37%
23%
27%
25%
50%
10%
42%
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 Decreased/Worse About the same
*State of the market dealer survey May ‘18

23. Dealers
45% of dealers* indicated an increase in days in stock, echoing data revealed in Motors.co.uk across all sectors
25%
54%
45%
49%
56%
22%
25%
21%
19%
24%
30%
30%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
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 May ‘18

24. Dealers
The economic outlook remains similar with only 9% anticipating improvement and 34% expectant of further decline*
9%
34%
57%
0%
10%
20%
30%
40%
50%
60%
Improving Declining About the same
%respondents
What are your expectations for economic conditions over the coming months?
(as a proxy for demand)
*State of the market dealer survey May ‘18

25. Dealers
36% of dealers envisage sourcing stock to worsen while 11% foresee improvement over the coming months*
11%
36%
53%
0%
10%
20%
30%
40%
50%
60%
Improving Declining About the same
%respondents
What are your expectations for sourcing used vehicles over the coming months?
(as a proxy for supply)
*State of the market dealer survey May ‘18

27. Outlook
Our viewpoint – 2018 the retail market
Strong appetite for vehicle
insight from dealers, to
support both buying and
selling
Used cars sales to
improve as consumers
are confused over
updated tax rules for new
vehicles
Retail
Dealers urged to adjust
stock volumes to match
consumer demand for
smaller used cars

28. Outlook
Our viewpoint – 2018 the wholesale market
An increase in the diversity
of stock acquisition through
physical and digital channels
An increasing desire for
enhanced imagery and
'ready for retail’
inventory
Scale operations will drive
demand for refurb and
retail-ready through
efficiency and logistics
costs
Wholesale

29. Outlook
Our viewpoint – 2018 the funding market
Cash flow and digital
integration remain
priority for dealers in
the year ahead
Ease and flexibility
remains key for
dealers
Dealers are looking for
complementary sources
to ensure they have
sufficient liquidity to buy
the stock they need
Funding

30. Outlook
Our viewpoint – 2018 the Dealers market
Further dealership
consolidation in line with
the long term trend of
declining franchised
dealer numbers
Dealers
Improving the digital retailing
experience and enabling
consumers to do more online
to provide a competitive
edge is increasingly
important
Challenging
environment of evolving
technology and ever
changing consumer
expectations

31. THANK YOU