Heycar: UK used cars dealership with 1000s of vehicles for sale to close as Volkswagen pulls plug on website

• Online used car platform Heycar is set to close after major financial losses
• The site lists 91,000 vehicles and employs 126 people, mostly in the UK
• Backed by VW Financial Services, Heycar launched in the UK in 2019
• Losses hit £22.4m in 2023, with revenue falling to just £7.4m
• Closure could lead to job cuts in the UK, Germany, and France

A major online used car dealership with almost 100,000 vehicles for sale, is on the brink of closing after incurring significant financial losses.

Heycar, which was launched in the UK in 2019, attempted to challenge established players like Auto Trader and Motors in the market.

It aimed to provide a trustworthy and user-friendly alternative to traditional used car dealerships by offering vehicles that were under 10 years old, had fewer than 100,000 miles, and came with warranties.

Despite its initial promise, the German-based platform faced significant financial challenges. In 2022, it reported a £30 million loss, followed by a £22.4 million loss in 2023, with revenues plummeting to just £7.4 million.

Volkswagen Financial Services (VWFS), the majority shareholder, has now decided to pull the plug on the operation, potentially leading to a closure as early as next month.

A VWFS spokesperson told Car Dealer: “Heycar has been a pioneer in the online used car marketplace and, despite the decision to wind down their operations, the valuable insights and digital solutions developed so far will play a crucial role in the future of VWFS UK, as we continue to explore new ways to drive growth and innovation in the automotive e-commerce space.”

VWFS also said that is has plans to launch a new subsidiary that will integrate Heycar's technology into its wider business.

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Heycar currently employs 126 people, most of whom are based in the UK, and the move could result in job losses across Britain, as well as Germany and France.

The company’s German operations are expected to end by mid-May, with the UK arm of the business likely to follow soon after.

The spokesperson added: “We expect that we will have to let go of a large portion of Heycar’s employees. However, we are considering whether some of the UK employees could be taken on by VWFS UK to further expand the used car business in the B2B sector.”

VWFS also told a German news outlet that it had “underestimated” the marketing costs necessary for Heycar’s launch and “misjudged the development.”

With Heycar closing down, it's likely that the 91,000 cars currently listed on its website will be removed.

The dealerships that were selling through Heycar will probably move their listings to other online platforms, like Auto Trader or Motors, or sell the cars through their own websites.

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