Online used car retailer, Carma, is now a few years into its successful foray into the competitive Australian marketplace, with strong growth across the business and no sign of slowing down.
Fleet Auto News sat down with Carma’s head of buying, Peter Willis, after first speaking early last year, to find out how the company is tracking and the market trends informing its focus as it sets its sights on the hybrid and EV segments.
When Carma launched mid-way through the turbulent COVID-19 period, many Australians were stuck at home and online shopping was on the rise. In fact, the timing was somewhat opportune for the online car retailer.
“Looking at the traditional way that the used car business operates, and the sort of frustration people feel with that experience, we were focused on trying to eliminate those pain points by bringing that digital element in,” Peter said.
“The big part about the timing of this business is that a lot of people were working from home. So a lot of people were buying in those online forums.”
While the COVID-19 lockdowns may have helped Carma’s online-first business model, as it launched into the market with a service that delivered cars to the front door of buyers, it wasn’t necessarily easy.
“Was it an easy piece to do? I don’t think so,” Peter said, reflecting on the early days.
“But I think that’s the piece around how we present as Carma – with transparency. We’re going to deliver a car to a person, and the moment that we deliver it to their home, it’s going to be the first time they see it. They’re going to accept that car if we’ve done a great job, or they’re going to refuse it if we haven’t.”
Fast-forward to 2024 and Carma is adding as many as 20 cars to the site everyday, as the team works to keep up with demand.
“I’m looking at it today and we currently have over 400 cars listed online, but that production centre produces anywhere from 10 to 20 cars per day,” Peter said.
“So every day there’s new stock arriving and we obviously need to keep up the sales. It’s a hard number to track, but day-to-day the sales numbers are continuing to lift for us.”
The company’s workforce has also grown to more than 150 people, as it remains committed to outsourcing as little as possible.
“We do all our own work in-house, so we can control the level and the quality of the work, the output and what our cars look like,” Peter said.
“So we’re actually building a product to a quality level rather than to a price. When you think about that and the level of detail we have, you can certainly see where the workforce is. We have our own tech team, our own customer experience and finance guys and we’re really controlling that business end-to-end – right down to the last-mile delivery.”
The trends Peter is seeing are centred around both economy and value, with strong hybrid sales and a growing interest in EVs.
“Efficiency is of highest importance to people, and value for money too, so you’re starting to see people really leaning into economical cars,” he said.
“Hybrids have been something that have been discussed for a long time, but they seem to be the number one staple for people today and then there’s the EV change. We’re seeing a year-on-year increase in the EV space and it’s still obviously quite new. As the sales continue to increase, we’ll certainly increase our volume and lean towards more of those cars.”
Peter says buyers are willing to consider a car that’s a couple of years old if it has low kilometres, rather than rushing out to buy a new car.
“People are looking for genuine value. We’ve gone through a few years now where prices were unstable – people didn’t really know what they had and what they needed to spend. We’re sort of back to a more traditional depreciation of cars and people are actually happy to look for that two- to three-year-old car that’s got good kilometres and looks like good value.”
That’s where Carma comes in, Peter explains, focusing on high-quality, low-kilometre vehicles that offer an alternative to purchasing a brand-new car.
“Our mantra is high-quality used cars, so if it’s got very low kilometres, even if it’s a few years old, they’re certainly cars we’d be wanting to buy,” he said.
“If it’s that ‘special car’ then that’s something we’d love to have, so we can provide a special experience for someone.”
From here, Peter says the goal is to continue to expand the Carma service across Australia while maintaining the quality of service customers have come to expect.
“The trend towards online buying is going to continue to grow from what we can see, so our expansion into everywhere across Australia is obviously the end goal,” Peter said.
“Making sure that we can provide a great customer experience to all our customers is at the forefront of everything we do, and ensuring that as we grow we can continue to deliver that experience across the East Coast and then the rest of Australia.”
