Remarketing sector hit by bottlenecks

Declining productivity in the reconditioning sector is causing difficulties in preparing cars and vans for sale, according to data from the Vehicle Remarketing Association (VRA).

The issue is being investigated by the trade body’s Industry Trends Committee, which believes that contributing factors include consolidation of remanufacturing providers, skills shortages, spare parts availability and limited resources suitable for electric vehicles (EVs).

Marcus Blakemore, chairman of the committee, said: “VRA members are increasingly telling us about the problems with refurbishment, which is having a direct impact on the speed at which vehicles can be resold and tying up money in assets that are simply waiting to be prepared for sale.

“This means vehicles with damage or defects become worth less because dealers know they will take longer to process and sometimes take not only weeks but even months longer than expected to reach retail channels.”

Consolidation

He continued: “The single biggest cause is the reduced number of properties available for refurbishment by the general remarketing sector, a situation that has been exacerbated by recent consolidations and company sales. In addition, there is undoubtedly a skills shortage, which can only be addressed by a renewed commitment to training across the sector, which will inevitably take time.

“Parts shortages are also having a real impact. This is an area that has improved since the pandemic, but it’s still a problem. Vehicles sometimes sit for months waiting for parts to be sold.”

He added that the problem is particularly acute for electric vehicles, saying the industry is not yet prepared to meet the number of electric vehicles coming to market.