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
September 2018
Philip Nothard
Customer Insight & Strategy Director - UK

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

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

5. Retail
WLTP influence on the September new car market was severe and indicated a clear absence of preparation from a number of manufacturers
45%
36%
44% 35%
43%
32%
45%
31%
44%
32%
43%
32% 43%
32%
40% 30%
40%
29%
51%
59%
52% 61%
53%
63%
51% 64%
52%
62%
53%
62%
52%
62%
55% 62%
55%
64%
4%
6%
4% 4%
4%
5%
4%
6%
4% 6%
4%
7%
6% 7%
5%
8%
5%
7%
174,564
163,615
83,115 80,805
562,337
474,069
152,076
167,911
186,265 192,649
243,454
234,945
161,997 163,898
76,433
94,094
426,170
338,834
0
100,000
200,000
300,000
400,000
500,000
600,000
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 Aug September
Registrationvolumes
New Registrations - fuel type
Diesel Petrol AFV

6. Retail
The retail market displayed positive results during September, with average sold prices of vehicles increasing 1.6% to £14,599 (up 4.1% YoY)
Sept ‘16
£11,843
Sept ‘17
£14,024
Sept ‘18
£14,599
£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
The strength and emphasis on used cars clearly demonstrated by the YoY reduction in days to sell by an average of 3 days overall
38
39
41
40
41
42
35
36
38
40
38
37
35 35
33
36
35
39
35
34 34
37
36 36
0
5
10
15
20
25
30
35
40
45
Overall 4x4 Convertible Coupe Estate Large Lower Medium Medium MPV Prestige Small Supermini
Numberofdays
Retail days in stock September ‘17 vs. ‘18
(as listed on Motors.co.uk)
Sept '17 Sept '18

8. Retail
Volumes and views decrease for diesel models countered by days in stock shortening by 4 days and electric vehicles by 12 days
Vehicle Views
Sept '18 - 51% of total
Sept '17– 49% of total
Stock Volume
Sept '18 - 48% of total
Sept ‘17– 57% of total
Days in stock
Sept '18 – 37 days
Sept '17 – 41 days
Diesel Petrol Hybrid ElectricHybrid
Stock Volume
Sept '18 - 45% of total
Sept '17– 41% of total
Stock Volume
Sept '18 – 1.33% of total
Sept '17– 1.11% of total
Stock Volume
Sept '18 – 0.19% of total
Sept '17– 0.29% of total
Vehicle Views
Sept '18 – 1.23% of total
Sept '17– 1.38% of total
Vehicle Views
Sept '18 - 47% of total
Sept '17– 49% of total
Vehicle Views
Sept '18 – 0.41% of total
Sept '17– 0.44% of total
Days in stock
Sept '18 – 36 days
Sept '17 – 36 days
Days in stock
Sept '18 – 38 days
Sept '17– 36 days
Days in stock
Sept '18 – 34 days
Sept '17– 46 days

9. Retail
Retail
• Retail market showed positive results during September, with the average sold price of
vehicles increasing 1.6% to £14,599 (up 4.1% YoY)
• Used Car sales performed well relative to September ‘17, with average days in stock down -
8% to 36 days
• Independent dealers sold vehicles 7 days faster on average and franchise dealers 1 day
faster
• Average Independent dealer now stocking 44 cars – 2 more than in September ‘17, with
Franchise dealers stocking one car less
• Larger vehicles sold comparatively well in September 18 with Estates (6 days quicker) 4x4s (4
days), and MPVs (4 days) all selling substantially quicker YoY

11. Wholesale
Wholesale prices remain in-line with YTD and previous Q4 performance whilst strong buyer demand led to a 10% increase in conversion rates
Sept ‘16
£5,805
Sept ‘17
£7,264
Sept ‘18
£6,370
£-
£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
Auction Wholesale Price
2016 2017 2018

12. Wholesale
Diesel wholesale prices decline -12.8% while petrol ease by -8.0% in September 2018; an average of -£801 overall
Wholesale Used Prices September ‘17 vs. ‘18
£5,190
£4,777
2017 2018
Petrol
£9,312
£8,124
2017 2018
Diesel

13. Wholesale
58% of dealers* say they are now buying vehicles from online auctions regularly, with a further 15% saying they do so occasionally
*State of the market dealer August ‘18
58%
15%
6% 3%
18%
0%
10%
20%
30%
40%
50%
60%
70%
Yes – I/we do so regularly Yes – I/we do so occasionally Yes – once or twice No – but intend to No – and have no intention to
Have you bought a vehicle from an auction remotely via an online facility?

14. Wholesale
Wholesale
The data – Summary
• Dealer Auction average sold prices rose 6.2% (compared to the same period last year), while
volumes of vehicles coming through the online lanes increased by 10%
• Selling prices remain steady, and in line with the year-to-date average.
• Introduction of WLTP on the September new car market was severe and indicated a clear lack of
preparation from a number of manufacturers
• Used car market remains extremely strong, with a 10% increase in conversion rates for vehicles
sold under the hammer during September, and a similar hike in the conversion of provisional bids
• Ex-fleet and manufacturer vehicles to remain at a premium as supply runs short

16. Funding
The average cost per unit increased by 4% to £7,703. The highest seen in the previous 33 months, indicating the appetite in used cars
Sept ‘16
£7,176
Sept ‘17
£6,990
Sept ‘18
£7,703
£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

17. Funding
Average holding days decreased marginally from August to 59 days – one day more than experienced in September 2017
Sept ‘17
58
Sept ‘18
59
30
35
40
45
50
55
60
65
70
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Averageholdingdays
Average Holding Days
2017 2018

18. Stock funding
Funding
The average age of funded units increases to 5.8 years from 5.7 years in the same period last year
September 2017
5.7 years
Ave. Age Funded
60,897
Ave. Mileage
September 2018
5.8 years
Ave. Age Funded
59,627
Ave. Mileage

20. Dealers
45% of dealers* report margin pressures as 58% cited the current demand for used vehicle stock challenges compared to the same period 2017
16%
49%
25%
29%
25%
20%
55%
32%
45%
16%
43%
58%
29%
19%
30%
55%
32%
22%
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 September ‘18

21. Dealers
Dealers* support the data indicating the strength of the used vehicle market, with only 1 in 5 reporting an increase in overage and days in stock
17%
22%
23%
20%
54%
48%
40%
40%
29%
30%
37%
40%
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 September ‘18

22. Dealers
32% of dealers* support indications that sourcing ‘ready to retail’ stock will toughen and on 13% positive about the economy in the final months of 2018
13%
45%
42%
What are your expectations for economic
conditions over the coming months?
(as a proxy for demand)
Improving Declining About the same
*State of the market dealer survey September ‘18
10%
32%
58%
What are your expectations for sourcing used
vehicles over the coming months?
(as a proxy for supply)
Improving Declining About the same

24. 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

25. 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

26. 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

27. 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

28. THANK YOU