Daimler’s captive finance arm has acquired a 20% stake in Heycar, a used car portal launched by Volkswagen Financial Services (VWFS) in Germany just under a year ago.
The deal comes with a capital raise for Mobility Trader, the VWFS subsidiary operating the platform, and a seat on the subsidiary’s board for Daimler. The value of the deal, rumours of which were first reported by German daily Handelsblatt last month, was not disclosed.
Heycar was launched in October 2017 as a multi-brand used vehicle portal. It offers retail and finance on 300,000 vehicles from 1,000 dealership groups, according to VWFS.
The platform has been cutting its teeth in the extremely competitive German retail market, pitting it against rival platforms like Autoscout24 and Mobile.de. The portal, which allows dealers to post classifieds and offering financing on their cars, operates not unlike Auto Trader and MotoNovo’s FindAndFundMyCar in the UK.
VWFS and Daimler have explicitly mentioned plans for expansion outside of Germany. Daimler Financial Services – which is soon to rebrand to Daimler Mobility as part of an organisational shake-up – will hold a seat on the board of each international subsidary created to operate Heycar.
The stake in Heycar also complements Daimler’s German used car schemes, named “Young Stars”, which started offering trade-in facilities at this year.
Franz Reiner, member of the board at Daimler Financial Services, said: “Used vehicles are increasingly being bought and financed online … We are enabling the further expansion of a cross-brand platform for manufacturers, dealers, automotive banks and customers.”
Christian Dahlheim, member of the board responsible for sales and marketing at VWFS, added: “We are open to further investors and believe that this underpins our claim to brand neutrality.”
Carmakers’ captives have been increasingly focused on improving their proposition in the used market segment – traditionally dominated by independent and bank-owned funders – as they seek to gain a pre-eminent position on dealer-brokers’ panels. In the UK, Vauxhall just implemented a tool allowing for online finance quotes an applications for its used vehicles scheme.
Captives’ growing interest in the used market is also a way of hedging against sluggish new car sales and residual value risk. The used market has been highlighted by retailers and funders as a relatively safe harbor amid fuel restrictions uncertainty and household spending squeezes.