6:55 am, May 7, 2022
Swansway director Peter Smyth says he now expects used car prices to remain high until next year despite the firm previously budgeting for an earlier return to normality.
The group director told Car Dealer that the firm had created its budget for the year based on the fact that prices would begin to come down.
It was forecasted that prices would start returning to pre-pandemic levels around the middle of 2022 but that now looks unlikely.
Smyth says it could be between 18 months and two years before prices finally settle at a stable level, due to the ever-changing state of the current market.
He put the situation down to global supply chain issues with new cars as well as the ongoing war in Ukraine.
Speaking exclusively to Car Dealer, he said: ‘When will things get back to normal is the million dollar question.
‘Like most dealer groups, when we were doing our budgets for this year we thought that probably by about mid-year things would start to be getting back to normal.
‘It’s now quite obvious to us in regards to new vehicle supply that we are going to have issues pretty much all year, so I don’t know when things will get back to how they were.
‘I believe it will be a period of the next 18 months to two years that new car production will get back to pre-pandemic levels.
‘There will be different stages and steps with that rather than one big slump in used car prices.’
Smyth, who recently took part in a debate on online disruptors for Car Dealer, also admitted that the current cost of living crisis was impacting the used car market.
He explained that with bills going up, potential customers are being forced to spend money elsewhere when it may have previously gone towards a car.
He added: ‘People are quite rightly concerned about the cost of living, fuel and bills – both for home and travel.
‘If that goes up by a couple of hundred pounds for somebody a month that is their monthly payment then.
‘Ordinarily they would have perhaps put that money to contribute towards a motorcar.’
