Used cars fetched £13,864 each on average in April – the first year-on-year growth on a like-for-like basis since July 2019, said Auto Trader.
The latest data from its Retail Price Index, based on pricing analysis of some 900,000 vehicles every month, revealed the rise of 0.1 per cent, which Auto Trader said would be welcome news for retailers.
Since lockdown started on March 23, Auto Trader said the market had largely been on hold, having tracked the number of retailers changing prices, the number of stock items being repriced, and the value of the price adjustment.
It said that under normal trading conditions, some 2,500 to 3,000 retailers altered their stock price every day. During the week of May 9 to 16, that figure was some 1,075 – a year-on-year decline of 63 per cent but 232 more than the previous week.
Auto Trader added that 21 to 25 per cent of retailers tended to change prices on a daily basis, but during the same week only nine per cent did. Meanwhile, an average of 6,000 vehicles were being repriced daily – 68 per cent lower than the same time last year, while 56 per cent of stock being repriced was by independent retailers.
When it came to the amount of readjustment, the average amount pre-lockdown was £250 to £550. Between May 9 and 16, the average price change was £277, with the average reduction for independent retailers being £210, while for franchise retailers it was £358.
Auto Trader said that although it highlighted that price movement was returning to pre-coronavirus levels, there was still a small number of retailers adjusting a very limited volume of vehicles.
It comes at a time when the number of people searching for a new or used car on Auto Trader is back to pre-Covid-19 levels, with over a million visiting the marketplace every day, as reported by Car Dealer.
Richard Walker, Auto Trader’s director of data and insights, said: ‘We’re very mindful of our responsibilities to customers and to the wider market, and so we’ve been closely monitoring the pricing of hundreds of thousands of vehicles to ensure we’re providing the most up-to-date and accurate evidence-based insights.
‘As we saw during the 2008/09 financial crisis, large price adjustments on a mass scale will have a major detrimental impact on the financial health of the industry.
‘We need to avoid a repeat of this scenario, and so it’s reassuring to see that retailers are not cutting prices. With consumer demand returning to the industry, we see absolutely no reason for them to do so.
‘Any negative movement based on speculation or editorial opinion is likely to result in a self-fulfilling prophecy of sharply falling prices.
‘We strongly believe retailers should hold firm on prices until the evidence suggests that they’re moving, which is more likely to result in any adjustment being a measured and gradual adjustment.’
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