The used car market has delivered its strongest price growth for nearly three years, according to Auto Trader’s latest Retail Price Index. For used car dealerships, the message is fairly clear: demand is holding up, stock is moving quickly and some parts of the market are looking much healthier than they have for a while.
Auto Trader reported that the average price of a used car reached £17,306 in May, up 0.7% year-on-year on a like-for-like basis. That may not sound like a dramatic rise at first glance, but in a market that has spent a long time dealing with changing consumer confidence, supply issues and EV price pressure, it is a notable shift.
Marc Palmer, Auto Trader’s head of strategy and insights, said May’s data reinforced “the resilience of the used car market”, with buyers “shrugging off broader concerns about the economy”.
For dealers, that resilience brings opportunity. It also brings a few operational questions worth keeping an eye on.
Used car prices are rising as demand beats supply
Auto Trader said strong consumer demand outweighed a slight softening in market supply, which fell 6.6% year-on-year. That imbalance helped push the average speed of sale down to just 29 days, two days quicker than in May 2025.
Fast stock turn is usually welcome news for retailers. Vehicles sitting around for too long can tie up capital, take up space and increase exposure to depreciation. A quicker sales environment can help keep forecourts fresh.
The catch, of course, is that buying decisions become sharper. In a market where well-priced stock sells quickly, dealers may need to act fast when the right vehicles become available. But speed should not mean cutting corners on appraisals, documentation, test drives, vehicle checks or customer processes.
That is where good operational discipline still matters. A buoyant used car market does not remove risk. It just changes where pressure appears.
Used EVs are the standout story
Used EVs were one of the clearest bright spots in Auto Trader’s May figures. Demand for used EVs rose 36.4% year-on-year, while supply fell 11.2%.
That helped used EVs sell faster than ever, taking an average of just 24 days to sell. Auto Trader said this was 12 days quicker than the same period last year and five days faster than the average used petrol car.
Perhaps more importantly, used EV pricing flattened year-on-year at 0.0% in May. Auto Trader said this marked the first non-negative year-on-year pricing result for used EVs since December 2022, ending 40 consecutive months of decline.
That is a pretty big psychological line in the sand. For a long time, dealers have had to think carefully about EV depreciation, changing consumer confidence and the pace of new technology. Stabilising prices may give retailers more confidence, although stock selection still needs careful thought.
The 3 to 5-year-old EV segment appears particularly important, attracting 48% of all used EV enquiries on Auto Trader’s platform and proving to be the fastest-selling age bracket.
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Older used cars are creating margin opportunities
It was not just EVs driving the market. Auto Trader said overall price growth was also supported by older stock, with prices rising across all vehicle age groups older than three years.
The 10 to 15-year-old segment rose 8.3% year-on-year, reaching a record average price of £7,213.
This may reflect buyers looking for more affordable options as running costs and household budgets remain under pressure. For dealers, older vehicles can create margin opportunities, but they can also bring more preparation work.
Older vehicles may need more mechanical checks, clearer condition reporting and careful customer communication. The price may be attractive, but buyers still expect professionalism, transparency and a smooth handover.
What this means for motor trade businesses
For motor trade clients, the latest data points to a market with genuine momentum. Used car prices are rising, used EVs are selling quickly and older stock is performing strongly.
But faster trading conditions can also create pressure on processes. More buying activity, more test drives, quicker turnaround times and a broader stock mix can all affect day-to-day risk.
Dealers may want to review how their business is set up for the current market. That could include how vehicles are stored, who is allowed to drive stock, how accompanied and unaccompanied test drives are managed, and whether business activities have changed since their motor trade insurance was last reviewed.
A policy that suited the business a year ago may not fully reflect a busier forecourt, more EV stock, different premises use or increased demonstration activity. No dealer wants an awkward gap to appear at the worst possible moment.
Auto Trader’s Marc Palmer said the fundamentals remain “firmly in retailers’ favour”, with well-priced stock continuing to sell quickly. That is encouraging.
The sensible move now is to make sure the operational side keeps pace with the market. Because when stock is moving quickly, it is usually the boring admin, checks and cover details that help keep everything on the road.