The UK’s largest automotive marketplace for buying and selling new and used cars announced the biggest ever increase in used car prices in August. And promisingly their data experts believe that the prices will remain high in the coming months as consumer demand is incredibly strong.
Retail Price Index findings published by the online market place also confirmed that the record growth was off the back of 4 consecutive months where values rose. August saw a 6.1% increase compared to the same month the previous year, and the jump even surpassed July’s year on year rise of 4.6%. Used cars in August sold on average for £13,705.
- The age old economic model of supply and demand remains as valid as ever – lack of stock with high visitor numbers was driving the price rise trend.
- Auto Trader received over 67 million views last month.
- The average price increase would have been even larger had there been sufficient stock to satisfy buyer demand for higher value vehicles.
- The sparse availability of certain nearly new used cars as well as diesels and automatics prevented an even bigger jump.
Low Demand for Low Emission Vehicles
Environmental campaigners will be sad to learn that alternatively fuelled vehicles (AFVs) actually bucked the trend and experienced a fall in demand. Whilst interest in fossil fuelled motors was stronger than ever which unsurprisingly resulted in prices rising in those segments of the market.
- AFVs values dropped by 1.1% with electric vehicles (EVs) worst affected, dropping over 5% year on year.
- Petrol vehicles saw demand up by 27% where-as there were 4% less units available leading to the average increase in values of nearly 7%.
- Diesel demand was likewise up substantially at 19% but listed vehicle numbers fell by over 20%.
Richard Walker, Director of Data and Insight at Auto Trader, said that since April the platform had, ‘Observed extremely strong consumer led demand.” Whilst increases can’t maintain at record-breaking levels month on month, he’s confident, “Prices will remain buoyant over the coming months.’
September is traditionally the second-highest month of the year for new car sale volumes. With March’s new number plate release severely affected by the Corona Virus crisis, we hopefully could see the strong performance of the used car market mirrored by sales of new vehicle numbers in September. A really strong performance across the board would be very welcome as the industry continues to get back on its feet post lockdown.
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