Land Rover models reign supreme for profit in 2023

Land Rover products dominated 2023 for the third year running, while other premium makes continued to deliver strong returns, according to Dealer Auction’s latest Retail Margin Monitor.

The Retail Margin Monitor identifies the highest retail margins seen on used vehicles bought via Dealer Auction’s wholesale platform each month. The Range Rover Evoque took the top spot in December and for the full year, with an annual average retail margin of £3,325.

Used Land Rover cars occupied the top position in all but one month during 2023 with the Range Rover Evoque achieving the joint-highest retail margin on record in November, commanding an impressive £5,100 profit. This matched the Land Rover Discovery 4’s average margin in August.

The Volvo XC60 achieved the second-highest margin over the year (£2,700), followed by the Mercedes-Benz E-Class in third (£2,650).

Top 10 models by retail margin in 2023

Luxury derivatives accounted for 100% of the 2023 top 10 dominated by Mercedes-Benz models: the E-Class followed by the C-Class in sixth place (£2,500) and A-Class in seventh (£2,450).

Dealer Auction’s marketplace director Kieran TeeBoon said: “Despite the economic and political headwinds in 2023, it’s clear that there are significant opportunities for stock-savvy dealers to bolster their profit margins and start 2024 on a high. The new data adds valuable extra context for dealers, too – for example, the tenth-place BMW 1 Series was the quickest seller of the year.”

From May 2023, Dealer Auction included two new metrics to further support dealers in identifying the most profitable stock. The average ‘Auto Trader days to sell’ reflects the estimated number of days it will take a dealer to sell that vehicle in their local area, while the average ‘Auto Trader Retail Rating’ uses three key metrics to determine consumer demand.

At brand level, Land Rover drew the highest profit for the third year running, with an average of £3,400. It was followed by BMW (£2,700) and Mercedes-Benz (£2,575), reflecting consistent monthly patterns. Over the year, Land Rover ranked first 11 times, while BMW and Mercedes-Benz held top three spots ten times and six times respectively.

Interestingly, while the same premium marques made up the overall top ten in both 2021 and 2022, there was more diversity in 2023, with a 60:40 split between premium and mainstream makes.

Top 10 makes by retail margin in 2023

Underscoring the Range Rover Evoque’s top spot in the 2023 table is its first-place ranking in the December 2023 chart, with an average retail margin of £4,675. However, there was more diversity further down the table with mainstream models the Peugeot 2008, Ford Kuga and Peugeot 3008 claiming the sixth, seventh and ninth spots, respectively, falling just shy of the annual top 10.

TeeBoon concluded: “This annual round-up is a brilliant indicator of long-term trends, but the performance of the Peugeot and Ford models in December reinforces the importance of looking at the most up-to-date insights to stay ahead of the curve.

“It’s also important to dig that little bit deeper into the monthly data and use it to find the stock that will suit your business goals. For example, in December, the ninth-place Peugeot 3008 was the joint-fastest seller, alongside the Mercedes-Benz A-Class. By harnessing the power of data, dealers can curate a healthy stock mix of ‘quick wins’ and opportunities for higher profit in 2024.”

Richard Walker, director of data and insights at Auto Trader commented: “Worryingly, it appears some pricing strategies are being guided by wholesale trends, placing pressure on retail values, and risking profits in the process.

"Our data shows that nearly 52,000 cars are currently being priced below their market value by circa 8,000 retailers, which is potentially costing them over £35 million in lost profits. 

"Rather than just a cause for concern, the retail and wholesale markets being out of sync also presents a profit opportunity for retailers who analyse the data on a car-by-car basis and price stock relative to retail valuations.”