Are car dealers getting dumped by savvy onliners?

Whilst some of the biggest car dealer groups have posted a 50% drop in profits in the first half of 2009, pioneering used-car website, Carsite.co.uk, is enjoying a bumper increase in sales, site traffic and sales conversion rates.

In July, the award-winning retailer of ex-fleet cars saw its sales to the public leap by 190% compared with the same month in 2008 and year-to-date sales double those of last year.

Site visits were also up 266% in July compared with 2008, despite a 66% decrease by the company in marketing spend; and the site's conversion ratio - the number of site visits resulting in a sale - increased 40%.

With the fleet industry releasing an estimated 800,000 cars each year, the vast majority of end-of-contract vehicles go through traditional physical auction, purchased by dealers or car supermarkets, who add their profit margin before selling them onto the public.

Carsite has stripped out these intermediaries, allowing them to offer consumers savings of up to 20% off traditional dealer forecourt prices, and eradicating the ‘pushy’ used car salesmen experience.

Carsite’s online car listings are also full of reassuring data unavailable on many rival retail sites, including a full independent RAC inspection report, HPI check, multiple digital images as well as RAC video test drives of the cars.

Much of Carsite’s recent success has also been thanks to its recently launched 'Early Bird' Preview service, where customers have the ability to browse thousands of highly sought after cars coming to the end of their contracts with fleet and leasing companies. A reservation fee of £75 (instead of a dealer profit margin) removes the chosen car from sale.