Motor Industry News
October 2012 Used Car Market Editorial
The past few weeks have seen an increase in both retail and trade activity in the motor trade. The introduction of last month’s 62 plate is the culprit. From a used car sales point of view, the new registration months are great opportunities to offer the more frugal new car customers a nearly new example. Also the part exchanges are a great way to fill up the forecourt with fresh stock at the right price.
This year, the new registration has distracted some retailers more than in previous years. Cars have been sat awaiting preparation for some time which has delayed them either hitting the forecourt or being moved on for trade disposal. A lot of good used stock is now starting to hit the market. The auctions are also seeing more of these good clean cars appear as traders realise that they either have or are rapidly reaching their stock limit.
Some traders are reporting record sales weeks for used cars, where others are crying the poor tale. So why the differing stories? The mixed messages stem from whether or not the individual trader or franchise has a positive outlook on current business. With today’s used car position it’s very difficult to have an easy ride whether it’s a buying or selling situation. It’s still possible to sell a lot of cars for good profit, but certain basic principles must be adhered to.
- Research the market and buy the right model, specification and mileage.
- Don’t bid low every time unless for ‘out of favour’ models and expect to buy ‘the right stock’.
- Take a chance on something unusual at the right price. Remember, a strange colour will still sell at the right price
For some time now our research has shown that the entire used car market is undergoing some very big changes, especially this year. Used car buyers have definitely changed their buying habits and over the past nine months this has been particularly noticeable. The on-going rejection of larger engine and high annual road tax bracket vehicles continues to be obvious, but buyers are also looking for much more practicality from their purchase. The lack of interest in the Coupe and Cabriolet sectors has not just been down to the appalling weather this summer. Many buyers are looking to cut their financial out-goings and are replacing two vehicles with one dual purpose model. Cars are becoming very expensive to own with ludicrously high insurance costs and punishing fuel prices. The days of owning a car for occasional use has long gone for many people, and for the foreseeable future. Traders must be more cautious when buying stock at this time of year and be more switched on to buyer needs.
For October we have dropped values by 3% across all models. The only exceptions to this are the older undesirables such as Mondeo, Vectra and 406 and, as mentioned earlier, the older Coupes and Convertibles. These models have been dropped by up to 5%.
VIPDATA is part of CDL Vehicle Information Services Ltd (CDL VIS) the vehicle data arm of CDL Group Holdings Ltd, based in Stockport, Cheshire.
Contact the CDL VIPDATA valuation team: