In December 2015, CarGurus announced the launch of its website in the United Kingdom, which marked the company’s first foray into Europe.

And soon, you can expect to see a second European market added: Germany.

In a March 13 phone interview with Auto Remarketing International, Sam Zales — who is chief revenue officer/president of international at CarGurus — said the company would be ready to launch in Germany in the next four to six weeks.

At time of the interview, CarGurus already had 200,000 units of inventory that had been approved for the site, “which is a very fast start for us,” Zales said.

The Germany launch will follow with other European markets — places like France, Italy and Spain. Asked if Germany was the natural choice for the second European market after the U.K., Zales said: “The next three or four are all similar; I think Germany is larger than the (others).

“We work with many of the OEMs in the marketplace … what we find interesting is the manufacturers are saying to us, because of the success in the U.K. —  particularly the European  manufacturers — boy, we’d like to see our dealers use a program like yours because we think we’ll get consumers to their doorsteps ready to buy more quickly,” he said.

There’s also a “pan-European buying experience.” In one country, you might shop for cars that are in another, neighboring country.

“So, the thought is, Germany is the next market, because they’ve been very open to our model, but the next three after that are very similar in scope and we’ll be fast following with those,” Zales said.

As CarGurus offers its services further into Europe, one question that comes to mind is the impact of the Brexit vote and the continent’s economical/political climate.

“I hope politically, things will go well for the European Union. I expect they will. I think people have not seen a major impact from the Brexit vote, and I think they’re trying to figure out how that process will even materialize,” Zales said.

“But the first thing, and most important to us, is that consumers in those markets do tend to buy locally. And that’s a great process for us, to put the consumer and dealer together. We’re a matchmaker, if you will, of the transparent process of those consumers and dealers buying from each other very efficiently,” he said.  

“But we do think there are some benefits to being in multiple European countries, where there is a search of a BMW out of Germany to bring it across to France, and we think that would be an interesting benefit of our being in multiple countries long-term,” Zales said. “We think the European Union will be a strong cross-country buying experience.”

Used-car opportunities

The U.K. and mainland European used-car markets appear to have some nice growth potential for CarGurus. And through the company’s experience in the U.K., CarGurus has found additional vehicle avenues beyond just “new cars” and “used cars” — similar to what is offered in the U.S. through certified pre-owned as the third option, so to speak.  

“When we say the U.S. market is one of our markets, now we’re opening up our total market opportunity to new countries that are having growth, with the exceptional growth in the used-car market,” Zales said.

“There are also a number of other car types, if you will, in the U.K. market where we’ve opened up ‘pre-registered’ vehicles. Dealers are often in a case of having to take inventory from the OEMs, the manufacturers, just a couple of weeks after they’ve been built,” he said.

“But they’re classified as used. So, there are great opportunities for us to put relatively new, but classified as used cars, into the hands of consumers who are very interested in buying those cars, because they come slightly cheaper,” Zales said. “And that’s a perfect opportunity for instant market values to demonstrate a great deal on a car from a great dealer, as they come off the OEM’s lots.

“So, there are these other registrations in the European markets, in the U.K., where we’ve learned will further benefit the growth of sales of cars through a shopping site like ours.”

There’s another vehicle classification similar to CPO known as “approved used,” where OEMs and dealer agree on a certification, and much like CPO in the U.S., it aims to drive consumer confidence, Zales said.  

Working with dealers, OEMs

In the U.K., there are automakers that own dealerships, Zales explained. CarGurus is working with some of those, and the nice perk is that CarGurus has a set of dealers to work with, on top of any of the automaker’s franchised dealerships that it picks up along the way.

“I think what’s been a real success for us,” he said, “is the penetration we’ve made with the largest franchised dealer groups in the U.K. market. We’re now working with eight of the top 10 franchised dealer groups in the market and there’s much more concentration, I find, in the U.K. Very, very large dealer groups that may have 20,000 or 30,000 units in stock that we immediately put onto our site and make the consumer experience much more rich.”

Not to mention, CarGurus also works with independent stores, and has partnered with industry trade associations to gain some ground, as well.