Tesco to Sell Used Cars
Discussion
To contradict the WhatCar article I had heard that they would be focusing on selling new cars online, not used cars. It's already a successful business model for WalMart in America so it would be safe to assume that Tesco would be following this model.
If they used their buying power they could completely change the UK car market; no doubt they would have to dispose of their used cars, but I would be surprised if they invest in the resources needed for recon etc. and the potential upset from disgruntled customers tarnishing their name.
However if they do enter the market successfully then it clearly won't take too long for the WalMart owned Asda to do the same....could be some interesting times ahead!
If they used their buying power they could completely change the UK car market; no doubt they would have to dispose of their used cars, but I would be surprised if they invest in the resources needed for recon etc. and the potential upset from disgruntled customers tarnishing their name.
However if they do enter the market successfully then it clearly won't take too long for the WalMart owned Asda to do the same....could be some interesting times ahead!
weyland yutani said:
f
k Tesco! I hope it implodes under its own weight one day. It's already killed the high street, fking greedy souless corporate bds!
So I take it at 3am when you've got a cracking headache and need some paracetamol you don't just nip down to the 24 hour Tesco and get some, you manage without and wait for the local shops to reopen in 8 hours? Or Saturday evening when you fancy a bottle of wine, or need a bunch of flowers in a hurry...k Tesco! I hope it implodes under its own weight one day. It's already killed the high street, fking greedy souless corporate bds!I like local independent shops and will put my custom with them whenever possible but Tesco has its place, the convenience, the hours they open, the range of products etc.
As for selling cars, jamjar couldn't make a proper job of doing it mail order, I doubt Tesco would be any different.
As a new car or private leasing firm I can see it taking off, especially if the focus on the cheaper family hatchbacks end of the market. Providing they are acting as a brokerage which may not make huge sums but will increase their brand domination even more, sadly the public would be more likely to trust a tesco branded site than a one they hadn't heard of.
matc said:
So they've bought a domain name and WhatCar have made up the rest of the story?! There are some shocking journalists out there!
http://www.cardealermagazine.co.uk/publish/car-dealer-source-reveals-tesco-is-planning-to-sell-used-cars/48449CarDealerMagazine said:
UPERMARKET giant Tesco is planning an imminent assault on the used car market in the UK, Car Dealer understands.
A source has told us that the conglomerate plans to sell hundreds of thousands of used cars a year – aged between one and four years old – via a website similar in style to Autoquake.
‘The sole aim of this will be for Tesco to up-sell its finance and insurance products to buyers of these used cars,’ said our source. ‘It’s likely they’ll make very little on each sale but instead use it to make lots of revenue from their financial arm.’
Leading online new car sales portal Motoring.co.uk’s director Chris Green told us this could be devastating news for the motor trade.
‘This news worries me and I’m sure it will worry dealers,’ he said.
So far Tesco has made no comment.
A source has told us that the conglomerate plans to sell hundreds of thousands of used cars a year – aged between one and four years old – via a website similar in style to Autoquake.
‘The sole aim of this will be for Tesco to up-sell its finance and insurance products to buyers of these used cars,’ said our source. ‘It’s likely they’ll make very little on each sale but instead use it to make lots of revenue from their financial arm.’
Leading online new car sales portal Motoring.co.uk’s director Chris Green told us this could be devastating news for the motor trade.
‘This news worries me and I’m sure it will worry dealers,’ he said.
So far Tesco has made no comment.
Hmmm, that whole article is speculation based on tescocars.com being registered - correct? For me it would make more sense for them to be a Drive The Deal type outfit - selling new cars at a discount based on the purchasing power? Can't see them getting involved with the hassle that is used sales.
TonyHetherington said:
That makes sense. Make little or no profit on the cars, but overnight have 100,000 more finance and insurance customers.
I'm not sure that would work either; if they're planning on selling the cars at little/no profit, all it will do is drive the prices of used cars down across the board. Not everyone is going to take advantage of their finance/insurance, so although I can see it could be reasonably profitable for them, it certainly wouldn't be making the most of the investment they'd have to make to set up the infrastructure needed to sell 'hundreds of thousands' of used cars.
matc said:
To contradict the WhatCar article I had heard that they would be focusing on selling new cars online, not used cars.
Exactly. Go online, order your Focus/Astra/C4, pay for it via Tesco Bank's finance, insure it using Tesco Insurance, and someone delivers it to your door a few days later. BlueMR2 said:
Do tesco have alot of company cars?
That could be a source of cars every few months if they get a rental style discount on them when new.
They do have a sizeable amount of Company Cars (mostly Audis, VW's and increasingly the Toyota Prius), however as they are all leased from GE Capital, selling them on to public would not be a viable option (they'd have to be purchased from GE to then sell on and the amount of available margin would be slim to none)That could be a source of cars every few months if they get a rental style discount on them when new.
Edited by farrendahl on Thursday 17th February 11:41
Soovy said:
I love the spit flecked bile directed at Tesco here.
Tehy provide good quality ata low price, and people love that.
THAT'S why they are successful.
Have to disagree. They have saturated every inch of the country (over 2,200 stores now) so they are by definition the nearest to most people.Tehy provide good quality ata low price, and people love that.
THAT'S why they are successful.
What do you define as quality? If you mean competent, knowledgeable staff, and good service, then I don't agree.
edo said:
What do you define as quality? If you mean competent, knowledgeable staff, and good service, then I don't agree.
Interestingly, my nearest store (currently on a week long closure because they're making it flipping mahoosive) is always populated by nice staff. The people at the butcher/baker bit, always happy to help and have a chat. The staff will always (even at insistence of me saying NO) will lead you to a product you ask for, rather than just tell you the isle, and the checkout staff are always very chatty and smiley.Seriously, if the experience in going there was a bad one I could understand the hatred but for me, personally, it's pleasant!
Matt UK said:
Petrol Eddie said:
You have to ask the question as to why Tesco would want to enter the used car market though. They can't squeeze suppliers like they do in the food market, its a relitivly low return on investment and the potential to ruin your brand through selling problem cars is too great. Selling new cars through the internet I get as its easy and requires little investment but used cars is a different ball game althogether.
You make a number of good pointsThe ROI is very low in the motor industry and they worked out that the space and money required would make a lot more profit if put into normal household goods.
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