May 2021 was the strongest May on record for used car performance, new figures reveal.
Auto Trader said May 2021 was trading around 14 per cent above May 2019 volumes.
The month’s strong performance is already being felt in June, the firm said, with week one already up over 15 per cent on the same period in 2019.
Auto Trader’s chief operating officer, Catherine Faiers, told Car Dealer Live the company has seen record demand which is delivering high numbers of leads to dealers.
‘In May, which for as long as we’ve been tracking the data, would suggest that may was a record month,’ she said in the video – which you can watch at the top of this story.
‘We’ve very much seen this in our audience data,’ she added. ‘We’ve seen visits consistently tracking up 25 to 30 per cent year-on-year.
‘The level of leads we’re delivering to retailers has never been has never been stronger.
‘And it’s great to see that translating through into the transaction data and volumes as well.’
Faiers explained how there were 1.7m ‘lost’ transactions in 2020 and this, combined with already high levels of demand so far in 2021, could sustain good used car transaction levels for the rest of the year.
The 1.7m figure was calculated based on the average ownership cycle of a car being extended from 3.5 years to 4.2 as a result of the pandemic.
Auto Trader said that if the UK car parc of 35.1m cars had turned at the typical frequency observed over the last 10 years, there would have been circa 10m new and used transactions in 2020, instead of the 8.3m that took place.
The company also said the market is current running at a record 9.7 per cent year-on-year increase, and the average speed of sale has been slashed to just 22 days.
Along with the 1.7m backlog of sales, Auto Trader believes growing economic confidence and positive sentiment will be another important influence on the levels of demand this year.
An onsite survey in May revealed that consumers’ confidence in being able to afford their next car was 8.76/10.
That’s at its highest level since Auto Trader began tracking it in January 2020, surpassing the previous peak recorded in February (8.75/10), and even ahead of confidence levels recorded pre-pandemic (8.11/10 in January 2020).
We’re seeing over half a million more consumers in that 18 to 24 year old age bracket on Auto Trader than we were seeing this time last year
The company said 41 per cent of those surveyed said they were more confident than they were a year ago, while 54 per cent felt about the same.
The research also revealed the growing importance of car ownership as a result of Covid-19.
Nearly one in three (29 per cent) of the circa 1,000 consumers surveyed believed that owning a car is more important to them now than it was before the pandemic – the highest rate since January.
Auto Trader said that while this positive sentiment shift is apparent in all age groups, it is particularly so in younger age groups.
Faiers explained that there has been a significant increase in the number of 18-24-year-olds visiting the marketplace, with over half a million more monthly visits from users in this age group in the second half of last year.
‘A lot of commentators in the industry were questioning is this group of consumers going to want to own a car today? Are they passionate about vehicle ownership in the same way that generations that have come before them are?,’ she said.
‘We’re seeing over half a million more consumers in that 18 to 24 year old age bracket on Auto Trader than we were seeing this time last year, which I think is really positive, long term sign of health for the industry.’
In the exclusive interview, Faiers also gave her views on agency sales and what dealers need to do to stay ahead of a rapidly changing market.