The used vehicle market is booming as competitors fight for a piece of the pie, valued at an estimated £500 billion (about $689 billion USD) across the EU and the U.K.
As part of the plans to expand its retail offering to include commercial vehicles later this year, Europe’s leading online car retailer, Cazoo, recently announced the acquisition of Bristol-based online van retailer, Van365, a leading independent online commercial vehicle retailer in the U.K.
Launched less than two years ago, the U.K.-based used car marketplace is one of the fastest-growing businesses in Europe. It has sold over 40,000 cars since launch, as consumers embrace the convenience of buying and selling used cars online.
Last month, the British car dealer announced that it was projecting $1 billion in revenue by the end of 2021, following a record first-half 2021 performance, during which revenue increased by 521% to hit £248 million (the equivalent of $335.6 million), helped by strong digital car sales during the pandemic.
The used car website is currently worth about £4.5 billion ($6 billion) after going public in August, grabbing the title of the biggest listing of a U.K. company on the New York Stock Exchange to date.
As PYMNTS recently reported, the online car retailer has been expanding across the U.K. and Europe, embarking on a series of acquisitions this year after the purchase of U.K.-based car subscription service Drover in December 2020.
In February, the firm purchased Germany’s leading car subscription service, Cluno; followed by last month’s acquisitions of one of the leading European data insights platforms, Cazana, and SMH Fleet Solutions (SMH), one of the U.K.’s leading vehicle preparation, logistics and storage businesses.
Related news: Car Retailer Cazoo Acquires SMH Fleet Solutions
Claiming a Slice of the Used Car Market Pie
As the pandemic continues to fuel a surge in online car sales, Cazoo isn’t the only player in the used car market riding the digital shift.
Constellation Automotive Group, one of its main U.K. competitors, recently acquired Amsterdam-headquartered CarNext, a deal that it said will create Europe’s largest digital used car marketplace, with over 2.5 million in annual car sales and a gross merchandise value (GMV) of €21bn ($29 billion).
Constellation is behind Cinch, one of the U.K.’s rapidly growing business-to-consumer (B2C) online used car marketplaces, which launched just a year ago. The group also operates two other online marketplaces: BCA, a business-to-business (B2B) website trading about 1.7 million vehicles across 14 European countries, and WeBuyAnyCar, a leading consumer-to-business (C2B) online car buying platform in the U.K.
According to a press release announcing the deal, the addition of CarNext will expand Constellation’s offering across seven major European countries, allowing the group to trade over 100,000 cars through its B2C marketplace, two million cars through its B2B marketplace and 600,000 through its C2B marketplace.
Avril Palmer-Baunack, Constellation’s executive chairman, said that “CarNext was one of the first companies in Europe to digitize the consumer used car buying experience, and we are looking forward to combining the scale of our respective marketplaces to lead the digital transformation of the used car market across Europe.”
She added that “data and technology excellence are central to Constellation’s ability to continue to innovate, and CarNext’s proprietary data and extensive European transaction data will give Constellation an edge.”
Earlier this year in May, the group raised over £1 billion to expand its business, receiving funds from top investors including Adia and Soros Fund Management.
Elsewhere in the online used car sales domain, the U.K.-based online-only used car marketplace Motorway recently made waves with the announcement that it was on track to hit $1 billion (£730 million) in sales this year.
Founded in 2017, the website — which uses an auction system to match car retailers with private sellers — sold £306 million worth of used cars in the third quarter of 2021, representing a 300% increase compared to the same period last year.