Online car sales: Gumtree merge with Carsguide and AutoTrader

Polly Fleeting

Wednesday 06 May 2020

Love a scroll through Gumtree every now and again? Well, if you’re on the hunt for a new set of wheels, the range of choice is about to get a whole lot bigger. 

Couple looking at each other while shopping for a car online via Gumtree

Last week, the Australian Competition and Consumer Commission (ACCC) authorised Gumtree’s acquisition of Cox Media’s Carsguide and AutoTrader. 

This means that Gumtree will combine with both websites and together they will offer new and used car advertising for both private and dealer sellers in Australia. 

And there’s no doubt that Aussies are car lovers. 

In fact, on average Aussies have purchased 1.1 million new cars every year since 2011, according to Carsguide. And that’s not even including second-hand vehicle sales! 

Will the merger result in a monopoly? 

The ACCC says no. 

“We authorised this merger because we concluded it was not likely to lead to a substantial lessening of competition, including in the supply of online automotive classifieds in Australia. Therefore it was not necessary to consider the public benefit limb of the authorisation test,” ACCC chair, Rod Sims said.

“Our investigation showed that Carsales and Facebook Marketplace are likely to continue to provide significant competition in online automotive classifieds after Gumtree acquires Cox Media.”

Started in 1997, Carsales is the leading online car advertiser in Australia. Along with the rapid growth of Facebook Marketplace, launched in 2016, it has proven a fierce competitor in the car sales game. 

The ACCC says that the combination of Gumtree and Cox Media shows minimal threat to other companies, as each offer different pieces of the puzzle. For example, Gumtree’s platform is more focussed on private seller listings, while Cox Media is stronger with dealer listings.  

Gumtree’s proposed acquisition of Carsguide and AutoTrader has been granted until May 22, 2021, so Aussies should expect to see the merger occur in the next 12 months. 

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