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Digital vehicle sales a winner amid coronavirus pandemic, says GlobalData

Digital vehicle sales a winner amid coronavirus pandemic, says GlobalData

Digital solutions to new car purchase that avoid human contact are one area of retail that will get a boost from the coronavirus (COVID-19) crisis, says GlobalData, a leading data and analytics company.

Mike Vousden, Automotive Analyst at GlobalData, comments: "With governments issuing stay-at-home orders, dealerships have seen customer footfall drop significantly or dry up altogether leading to markedly reduced auto sales.

"We are already getting an indication of change ahead by seeing how dealers are approaching sales in China, which is a few months ahead of the western world in terms of managing the outbreak. Geely, one of the country’s largest automakers, has already launched a no-contact car buying service – the disinfected vehicle is delivered to the customer and the keys are sent separately via a drone.”

However, completely ‘faceless’ vehicle buying is not likely to take off in markets used to a more traditional way of doing things, such as the US.

Vousden continues: "In the US, we are likely to see ‘halfway house’ solutions evolve, with dealers offering virtual tours of vehicles or negotiations over video calling services. In the UK, a start-up from the founder of Zoopla called Cazoo, which aims to bring the simplicity of digital retail to the used car market, managed to raise £100m from investors in March - despite current market uncertainty.

"One of the reasons investors were attracted to Cazoo is its focus on digital sales, which is expected to be a big plus when the pandemic comes to an end.

"Now more than ever, dealers must embrace new methods of selling cars to customers – especially those that allow more of the shopping and buying process to be done remotely. While we expect a relative return to normality once the pandemic passes, we also see a longer-term shift away from face-to-face sales as customers become more cautious about their interactions with others."