European used car platform Auto1 is deepening its artificial intelligence (AI) focus amid record profits.
The company on Wednesday (May 8) reported quarterly earnings showing $175 million in gross profits, a 23% increase year over year.
While discussing this milestone on the company’s earnings call, CEO Christian Bertermann also spent some time exploring Auto1’s efforts on the AI front.
“As of Q1 we are able to price 89% of cars offered to us through AI pricing,” he said. “This is 62 percentage points more than in Q1 of [2021]. … We remain convinced that our AI pricing capabilities form an important competitive advantage.”
In addition, Auto1 has begun work on “several AI-driven initiatives that will increase our competitive modes,” the CEO added, such as AI recommendation algorithms designed to improve the quality of vehicles the company makes to its merchant and retail customers.
PYMNTS included Auto1 earlier this year in a report on online car platforms’ digital investments in the name of increasing sales. (In this case, it was the company’s plans to expand its drop-off locations in customer-centric places, a bid designed to enhance accessibility and streamline the selling process for consumers.)
“Amidst global macroeconomic uncertainty and its implications for online car sales, the key to success in this sector seems to lie in prioritizing digital transformation within business strategies,” that report said.
“This strategic focus is not only enhancing resilience against economic fluctuations but also enabling organizations to capitalize on the transformative power of digital technologies, while driving sustainable growth.”
Meanwhile, PYMNTS last week examined a car-shopping dichotomy seen among younger consumers: They enjoy browsing for new vehicles online, but when it comes to making the purchase, they don’t want to give up the in-person experience.
“We recently did a study, and the majority of younger people actually want to complete their purchase of a vehicle in person at the dealership, which was a bit of a surprise for us,” Rebecca Lindland, senior director of industry data and insights at Cars.com, told PYMNTS.
“But we think that part of it is that you still want that chance to touch and feel and test drive your vehicle. … Younger consumers in particular still want to have that experience of going into the dealership, looking the person in the eye — that feeling of authenticity.”
Because cars are typically the “second-largest purchase” a consumer will make, she said, these interactions can go a long way toward increasing trust.