New finance legislation could boost retailer profits
09 December 2024
Retailers could see improved profit from finance sales once the legislation around commission payments has been clarified and finalised, according to Auto Trader CEO Nathan Coe.
Speaking to Auto Retail Agenda, Coe said the “finance situation will work itself out, in future it will be more transparent and better for the consumer.”
He said that finance was a good way of buyers protecting themselves against residual value volatility, particularly with used electric vehicles.
“You have to look at why only one in four used cars are bought on finance when 80% of new cars are on finance. That ratio could increase [for used cars], if transparency was better and there was more competition in the market – especially when you can see supermarket loans for 3% and car loans are at 7 or 8%. There could be more profit for retailers in used car finance thanks to greater finance protection.”
* Read the full conversation with Coe in this month’s Auto Retail Bulletin – sign up here
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