From 1 February 2023, Volvo France is using a new used car label strategy. Now, products up to ten years old or 150,000 kilometers can be considered by Volvo Selekt Occasions.
95% of the Volvo network in France follows the Volvo Selekt label.
The winds of change are blowing at Volvo. The French subsidiary of the Swedish brand has decided to make major changes to its VO label. Indeed, as stated by the business director Christophe Duchatelle in the Journal de l’Automobile, Volvo Selekt Occasions extends its contractual service to used cars up to ten years old or 150,000 km.
“Our Volvo Selekt Occasions label had not changed for a long timeexplains Christophe Duchatelle. It was a bit of a luxury to be limited to covering only VO under the age of five. The world has changed and we have decided to adapt“. The new conditions will apply from February 1, 2023 and the placement in all agreements of the signatories of the contract will take place in about three months. Time to establish POS and implement training in commercial negotiations.
In concrete terms, the warranty provided by Volvo Selekt Events will be extended to 24 months for brand vehicles less than two years old. It will go up to 12 months for VO and between two and ten years of seniority. To do this, Volvo has prepared the case for a long time with CarGarantie, its partner. Another change, the “Satisfied or money back” clause is extended to 30 days after purchase. “This is not a short-term answer, we wanted to give a permanent answer,” comments the commercial director.
In 2022, 34,532 Volvos changed hands in France, across all channels, according to AAA Data. A decrease of 12.5% compared to 2021. Brand sellers had a total of 9,800 sales, including 6,008 units under the Selekt Occasions label.
A network of official distributors who, according to the manufacturer’s statistics, represented 55% of the national activity for second-hand Volvo cars in less than five years. Their penetration was also 30% in the used car segment of 5-7 years. For types of products outside the label limits, sellers had a weight of about 6% of the volume.
The XC60 was the top used car seller. The XC40, however, is starting to challenge it for the top spot. And if hybrids are starting to weigh heavily in the registration of used cars under the label (about 30%), hot models and especially diesels remain more respectable. A combination that results in an average price of 25,000 euros.
On the distribution side, the network suffered from VN delivery delays. In fact, the number of survivors has decreased significantly. Christophe Duchatelle still estimates their contribution to revenue at 60% last year. Otherwise, LLD returns and dry purchases contributed 25% and 15% respectively. “Short-term lease returns totaled 700 units and these were the 2020 and 2021 vehicles that have been added.“, concludes the business director.
The distribution plan will therefore continue to change this year. The national administration wants to help dealers implement solutions using transparent methods of vehicle recovery. “Sponsorship will be the key to communicating with customersargues Christophe Duchatelle. But we also want more activity on auction platforms from traders. We must no longer be satisfied with what passes casually through our hands” launches, on offense. Increasingly, French management will encourage distributors to identify an official buyer as well as have dedicated used car dealers.
Expect sales of 20,000 in 2026
A stronger label and a better organized distribution structure: these will be the two pillars of Volvo’s growth in the second-hand market. The business director therefore estimates that the network will be able to sell a total of 7,500 used cars under the Volvo Selekt label in 2023.As we expect increased NV sales and increased funding, this will work to UV’s advantage“, he recalls. By 2026, Christophe Duchatelle has set the goal of collecting 20,000 labeled or unsold cars per year in the network.
Until then, other ideas can be fulfilled. In the offices of the headquarters of the subsidiary, the discussion is related to the principles of leasing for professional clients. But it is also about the tools to facilitate the import of cars from Sweden and the resale platform. The wind of innovation has not stopped blowing at Volvo France.
In the coming weeks, the new POS and training channel will be released in the Volvo Selekt Occasions network.