By year's end, Jetcon, a renowned used car dealer with a 35-year history, is set to embark on a significant transformation. The company, facing mounting losses from used car sales and a financing environment favoring new cars, has decided to shift its focus entirely to selling new vehicles. This decision comes after careful consideration and analysis of the market trends and the company's financial situation.

Jetcon's Bold Move - From Used to New Cars

Company's Decision and Background

During the company's annual general meeting on Wednesday, CEO Andrew Jackson revealed the company's plans. He explained that the continuous losses from used car sales and the favorable financing conditions for new cars made the shift to selling only new cars the most viable option. Currently, the inventory of 350 to 500 used cars has been reduced to about 50. Jetcon had been contemplating this move for some time and had previously been indecisive about leaving the used car market. However, recent data showed that every used car sold was at a loss, while new cars brought in a profitable margin.This decision is not taken lightly, as Jetcon has been a major player in the used car market for 35 years. But the changing market dynamics and financial pressures forced the company to make this strategic shift.

Challenges and Opportunities in the New Car Market

Jackson emphasized the new challenges that come with entering the new car market. "Every time we sell a used car, there's a lot of cost involved in getting the car prepared; and after we sell it, they come back with issues that cost us something. We sold a car recently; it came back three months later with transmission issues. That's $200,000, $300,000," he said. On the other hand, in the new car market, they haven't faced such issues for nearly two years since diversifying.However, the company also sees significant opportunities. Jackson noted that there has been a major shift in the world auto market, with Chinese cars making remarkable progress in terms of styling and quality. This has disrupted the entire car market, and Jetcon believes the Jamaican market will follow suit. The company has an exclusive dealership for Beijing Automotive Industry Corporation's passenger cars and offers models like the Beijing X55 and BJ40, which compete with popular SUVs.

Impact on Used Car Business

The shift has had a significant impact on Jetcon's used car business. Sales dropped from a high of 688 units in 2022 to 383 units in 2023. Jackson attributed this mainly to customers facing difficulties in accessing loans. Banks are now more inclined to lend for new car purchases rather than used cars, and there is increased competition in the used car market with over 500 registered dealers.Despite the decline, Jetcon is exploring ways to optimize its used car operations. They are looking at ways to improve the quality and value of their used cars to attract more customers and potentially increase sales in the future.

Diversification into Solar Equipment

In addition to the new car business, Jetcon has diversified into wholesaling solar equipment. Jackson stated that there are no plans to enter the retail market for now but will focus on selling to installers. The company has established partnerships with Chinese equipment manufacturers for solar panels, inverters, batteries, and other equipment. This diversification allows Jetcon to explore new revenue streams and reduce its dependence on the automotive market.Overall, Jetcon's move to shift from used cars to new cars is a bold step that reflects the company's adaptability and ability to respond to changing market conditions. With its exclusive dealership and diversified business units, Jetcon is well-positioned to navigate the evolving automotive and energy markets.