- The current average price of a used car is up 2.8% year-on-year (YoY), at £17,975.
- Auto Trader records 20% YoY increase in consumer demand during July.
According to the latest data from Auto Trader’s Retail Price Index, a decline from the 3.2% YoY increase recorded in June, to the 2.8% YOY increase in July, signifies used car retail values are softening. On the other hand, retail prices have risen 0.3% month on month.
The current average retail value of a second-hand car aged over 15 years old has increased 8.7% in July 2022, now valued at £5,805. Furthermore, this indicates a 2.6% increase from June 2023. Average prices of 10-15-year-old cars (£6,634) are up a slightly more conservative 1.4% MoM, but have increased a whopping 11.1% YoY.
Supply pressures, overlooking robust consumer appetite, are driving the rapid increase in demand, established by the current levels of demand outpacing the availability of stock. Supply constraints of older age cohorts today are the consequence of the financial crisis of 2008, which saw a slower quantity of brand-new cars flowing through into the retail market.
The rate of supply growth for electric vehicles (+174% YoY) is remaining to overtake the levels of growth in consumer demand (+6% YoY). This had implications on electric vehicle retail prices, which is down -20.7% on last year at £31,622. In contrast, the average retail price of used petrol (£16,519) and diesel (£16,570) cars, of any age group, is up 5.2% and 5.1% YoY respectively.
Sue Robinson, Chief Executive of the National Franchised Dealers Association (NFDA), added: “The used car market continues to function in good stead; values are rising, supply is improving, and demand is robust. Electric vehicle prices are also stabilising which is positive, the price parity between EVs and ICE has always been one of the significant barriers to adoption for motorists. With used EV prices declining and edging increasingly closer to the price range of consumer budgets, the data is starting to show an uptick in demand, opening doors of opportunity for retailers to take advantage of this market.”