How Agility Can Keep The Used Car Market Afloat

How Agility Can Keep The Used Car Market Afloat

After a couple months of shutdown due to COVID-19, OEM manufacturers are once again opening their factories to begin mass production. While this is positive news, there are still many challenges to overcome, specifically as it relates to the used car market. 

Used car values plunged to great depths amidst the pandemic. Dealers want to move inventory, but low consumer sentiment, a reduced number of trade-ins, auctions at a virtual standstill, and fewer lease returns coming back to dealerships is keeping used cars from selling. Additionally, the challenging situation the rental companies are in, are only exacerbating the issue. As quoted in Fleeteurope.com, German based rental company Sixt “substantially reduced its fleet size and redeployed rental vehicles to its car sharing service as it deals with the business impact of the coronavirus. Travel restrictions and stay-at-home orders have drastically reduced demand for daily rental services, hitting the company’s revenues.” The article goes on to say, the company “downsized our biggest cost driver, the fleet, by 13% compared to the average number of vehicles in the previous year already in Q1 to instantly free liquidity.”

COVID-19 has created a situation similar to what the used car market experienced in the 2008 financial collapse—hesitant buyers and supply far exceeding demand. But that market did recover eventually, as will this market. It’s not so much a question of will it, it’s a question of how fast and what can be done to expedite the recovery time. 

One solution is agility. 

RPM is a transportation provider with a unique ability to flex up or down, fully capable of handling market volatility. Our robust network of 100% vetted and monitored carriers allows us to fill capacity quickly for our customers, getting their wholesale inventory to market and minimizing the negative impact to their bottom line. Our flexibility allows us to bring true efficiencies to the distribution chain.

Another difference is our people, who bring years of experience within the finished vehicle space plus utilization of top of the line track & trace. We operate in a fully digitized environment, offering full visibility & transparency to enhance the customer experience. As a tech enabled provider, our TMS, facilitates streamlined communication—single point of contact for our customers and carriers. Our centralization allows us to quickly and efficiently communicate via phone, email, documentation, etc…

Our TMS allows customers a real-time view into their entire finished vehicle supply chain. Our finished vehicle specialists help identify gaps in the supply chain, improve efficiencies, reduce empty miles, create loops, and create a tailored solution for our customers to find the best strategies that will move their vehicles efficiently. 

The effects of the pandemic won’t last forever. Consumer demand for used cars and supply of wholesale vehicles will eventually balance out. Although it may take years for normalcy to truly return, taking the necessary preemptive measures of working with an agile provider who has the dedicated carriers and years of experience will help reduce time.

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