11:34 am, September 18, 2020
Used car prices are now up 7.4 per cent compared to the same time last year, says Auto Trader.
The strong growth in average used car prices has continued into September with the latest prices takes from the week of September 7 to 13.
The snapshot of around 425,000 vehicles currently advertised on the website marks 19 weeks of consecutive price growth in used car prices.
Auto Trader said the price performance had been partly driven by the exceptionally strong demand in the market.
It has seen record numbers of daily visits to Auto Trader – with an average of 2.1m visits a day across its platforms last week – a 30 per cent year-on-year increase.
Supply and the ongoing pressures in the market was another key factor, it said.
Last week, demand rose by 19.7 per cent year on year, while supply was down 10.4 per cent.
Auto Trader also said that while the number of dealers making price changes and the value of their price adjustments had begun to go up since the end of the lockdown restrictions, they were still significantly lower than pre-pandemic levels.
Last week, the average number of retailers making daily price adjustments was 1,158 – 166 more than the end of August but 15.9 per cent lower than last year.
In total, 9,683 cars were repriced during the week, which is 35 per cent fewer than last year.
Richard Walker, Auto Trader’s director of data and insight, said: ‘From a pricing perspective, what we’re observing on our marketplace is a very gradual return to pre-lockdown levels, with a small increase in retailers active but across fewer numbers of cars and the adjustments at the lower end of what we would typically see.
‘It’s indicative of the confidence in the health of the market, and while demand continues to grow at such robust levels we’re not seeing any indicators that suggest retailers are under pressure to reduce their prices.’
He added: ‘Contrary to many expectations of a drop in consumer confidence, our research suggests the opposite is true.
‘In December last year we began tracking consumers’ confidence in being able to afford their next car, and in August this reached its highest rate.
‘What’s more, 45 per cent of consumers on our site said they’re more confident in their ability to afford their next car than they were a year ago.
‘All of these metrics offer a promising outlook, and whilst the rate of growth may begin to ease, we have every reason to believe that both used car prices and sales will remain buoyant during the weeks ahead.’
Average prices for used internal combustion engine (ICE) cars continued their strong rise, thanks to demand outstripping supply.
Last week, demand for petrol was up 22.3 per cent year on year, while supply fell by 5.1 per cent.
Meanwhile, diesel demand saw an increase of 13.6 per cent year on year but supply dropped dramatically – down 20.8 per cent year on year.
Supply exceeded demand for low-emission cars. As such, prices for alternatively fuelled vehicles (AFV) continued their downward decline, although the rate is starting to slow.
Used cars aged 10 to 15 years saw a particularly steep decline in supply – down 16.4 per cent year on year last week, resulting in the largest growth so far this month, with a year-on-year increase of 11.9 per cent.
It was followed by five-10-year-old cars (10.8 per cent), three-five-year-olds (9.7 per cent), one-to-three-year-olds (5.9 per cent) and up to one-year-olds (4.1 per cent).
In August premium and volume brands recorded a strong price growth thanks to demand outstripping supply, and Auto Trader said this performance had continued into September, with the average price of used premium and volume cars increasing by 6.1 per cent and 10.9 per cent respectively.
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