THE managing editor of Glass’s has declared the used car market to be in a state of nervous anticipation.

Adrian Rushmore has said that the used car market could well be experiencing an ‘extended period of calm before a short storm in November,’ and has made predictions for the months ahead.

With year to August registrations down 16.3 per cent and consumer incomes pressurised, Rushmore believes it is difficult to see what would have encouraged consumers to purchase cars in September.

‘The knock-on effect is that dealers have fewer part-exchanges to retail from forecourts or to re-sell into the wholesale market,’ says Rushmore. ‘The auctions are also likely to experience a slight reduction in supply because, this year, an increasing number of dealers are keeping more of their part exchanges to put on the forecourt, and additionally a greater number are choosing not to trade their over age stock.’

With the changing dynamics of new cars sales taken into consideration, Rushmore predicts this will impact upon the market in two ways.

‘Firstly, there will be a different mix of cars entering the auction halls, with supply expected to be significantly less at the beginning of the quarter,’ explains Rushmore. ‘It is customary for dealer part exchanges to arrive from the middle of September with a peak in supply taking place during the early part of October.

‘If new fleet sales are more than three per cent up, or if used retail business is more depressed than most believe, the November reduction could be slightly worse’

‘The influx of defleets does not get into full swing until the first week in October and the hammer may not have fallen on many of these cars hands until November. And so, dealers visiting the auctions this year are likely to find greater numbers of high mileage three to four year old cars as a proportion of total supply.

‘The other influence will be one of price,’ continues Rushmore. ‘During the first half of October, the lower supply of dealer part-exchanges may serve to slow the fall in prices. It would only be when the defleets arrive in increasing numbers that prices fall at an accelerated rate.

‘On the basis of previous trends and the factors outlined, it would be reasonable to suggest that movements this year for three year old cars could be a two per cent fall in October and five per cent in November.

‘However, if new fleet sales are more than three per cent up, or if used retail business is more depressed than most believe, the November reduction could be slightly worse.

‘In either case, there may well be an extended period of calm before a short storm in November.’