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Used Car Remarketing
Abstract
Car manufacturers and dealers have tended to exclude used cars from their businesses thinking that the focus of dealers’ sales efforts should be on new cars, which carry higher price tags targeting wealthier buyers. Dealers and original equipment manufacturers (OEMs) have been aiming to push the new car inventory to the market with applicable incentives. However, used cars have started to add more to dealers’ bottom lines than sales of higher-status new cars. Improved quality and reliability of used cars have initiated a devoted customer base. As a result, manufacturers started to consider the crucial role of used vehicle management in improving residual values, new car sales and manufacturer brand equity. This study investigates the used car business, particularly in the United States, Europe and Turkey. The purpose of the study is to uncover the main drives of the used vehicle business and applicable competition means for OEMs (Manufacturers) and dealers.
... Another strand of studies has examined dealerships, market dynamics, and pricing factors (Biglaiser et al., 2017;Huang, 2020). Others have analysed the influence of trusted car data and the symmetry of information on the power struggle between garage owners, middlemen and buyers (Duvan & Ozturkcan, 2009;Zavolokina et al., 2020). Though the second-hand car market structure varies across regions, the relational processes that produce intersecting differences in meaning are ignored or neutralised. ...
Relational ethnographies presume conceptual emphasis on relations over objects engaged in those interactions. In that sense, social relations are not viewed as external and static among the actors but as unfolding dynamic and interconnecting processes. In this paper, I draw on Desmond’s relational ethnography to argue that micro-level dynamics and particularities of social relations among actors in Ghana’s second cars and auto parts market (re)produce interlocking relations of opportunities, sense of belonging and contestation. It shows how citizenship is used to draw the contours of dealers’ legitimacy and exclusion from the market. The findings indicate that nuanced events and expectations tied to relationships such as family and fictive kinship prescribe the social dynamics of interactions and their patterning in networks. This article complements traditional relational studies by demonstrating how national sentiment offers an additional meaning beyond the discourses known in a transnational trade (i.e. second-cars market). This is critical for understanding the socio-political discourses on nationalist sentiments and challenging realities in the informal economy.
... The CPO market represents a secondhand market with higher average quality, distinct from the traditional secondary market. Empirical research suggests that customers would be willing to pay 5% more for a CPO than for a used good in the traditional secondary market (Duvan and Ozturkcan, 2009). ...
The economics research suggests that firms can use trade-ins as a revenue management device for price discrimination between new and replacement buyers of durable goods. Offering different prices to different groups of customers creates a market segmentation effect. This study examines such an effect by considering trade-ins and certified pre-owned options for a durable goods firm, where certified pre-owned (CPO) represents the used goods market generated from the return flow of trade-in transactions. The optimal pricing and/or trade-in rebate is determined, and the strategic choice between the two options is examined. An analytical model is developed that incorporates the key durable goods features into model formulation, specifically the deterioration rate (or durability in a reverse measure) and the variation in quality of the used goods. Our research findings indicate that: (i) the magnitude of trade-in rebates increases with the deterioration rate and quality variation; (ii) the segmentation effect outweighs the cannibalization effect when the deterioration rate is moderately high; (iii) the strategic choice of trade-ins and CPO options is critically dependent on these two features; and (iv) the majority of profit improvement is generated from trade-in provisions, although the CPO option can serve as a second profit boosting device.
The decline in sales of new cars in Russia leads to the necessity for a more complicated procedure connected with the sale of pre-owned cars. Creating a sequence of premium brand pre-owned cars purchasing and selling will lead to an increase in new car sales and increase customers loyalty. A mathematical model of the formation of car purchase and transaction chains is proposed. The developed program module allows to create the required number of transaction chains based on customers requirements. A numerical example demonstrating the effectiveness of the module for the regional car dealerships is provided.
Yuz yildan daha uzun bir gecmise sahip olan otomobiller ulasim, varlik ve statu gostergesi, ticaret vb. gibi amaclarla kullanilmistir. Otomobillerin kullanim alanlari ve kullanici sayisi arttikca urun cesitliligi de artmistir. Boylece otomobiller gunumuz tuketicilerinin olagan ihtiyaclarindan biri haline gelmistir. Bu calismada yeni otomobilden cok daha buyuk bir pazara sahip olan ikinci el otomobillerin tercih nedenleri ve tercih kriterleri belirlenmeye calisilmistir. Bunun icin olcek gelistirme surecinden gecirilen anket yontemiyle gecerli 271 anket verisi elde edilmistir. Elde edilen anket verilerine guvenirlik, frekans, yuzde, crosstab, anova ve t test gibi analizler yapilmistir. Sonucta ikinci el otomobil tercihinde ekonomik nedenlerin one ciktigi, arkadas ve tanidiklarin hem daha guvenilir hem de ilk basvurulan satici oldugu gorulmustur. Ayrica alternatifler arasinda yapilacak tercihte aracin hasar durumu, yakit tuketimi, fiyati ve performansi en cok onemsenen konular iken kasa tipi, kredi imkâni ve aracin rengi de en az onemsenen hususlar oldugu gorulmustur. Ankete katilanlarin ikinci el otomobil aliminda en cok guven sorunuyla karsilastiklarini belirtmislerdir. Anahtar Kelimeler: Otomobil tercihi, ikinci el otomobil, tuketici davranisi.
İkinci el otomobil tercihine ilişkin tüketici algılarının incelendiği çalışma.
India is the one of the top 15 largest passenger car markets globally, and is expected to be among the top 10 markets by 2016. Post-liberalization, many foreign manufacturers have set up their operations in India. The latest trend of new cars on the Indian road has led to the emergence of an entirely new market in the pre-owned cars segment. It is expected that the small car segment is set to grow at a Compound Annual Growth Rate (CAGR) of 15-16% in the next five years. Also, the pre-owned car market is set to grow at a CAGR of 18-20% till 2015, and small cars dominate the pre-owned car market as well. Though the unorganized segment dominates the pre-owned car market, the organized market also has been gaining momentum. About 75-80% of the transactions in the pre-owned car segment occur in the unorganized sector, and the organized players account for only 20-25% of the pre-owned car market. This study aims to identify the factors influencing the buying behavior of customers towards the purchase of pre-owned small cars, and to analyze the preference of customers towards the organized and unorganized market during the purchase of pre-owned small cars. ‘Budget constraint’, ‘cheaper than a new car’, ‘upgradation of driving skills’ and ‘desire to own a car’ were the important factors that influenced the purchase of a pre-owned small car. Clear title, negotiation, and mutual trust were the important reasons for preferring the unorganized market for the purchase of a pre-owned small car, whereas the respondents preferred the organized market due to clear title, professional assistance, genuine spare parts, certification, and easy availability of after-sales service.
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