Motor Industry News
My Car Check Trade used car market overview June 2015: how will manufacturers, dealers and consumers react to the referendum?
My Car Check Trade is the trade valuations arm of CDL Vehicle Information Services. Based on cutting-edge industry data and feedback from independent and franchised dealers, these monthly bulletins highlight the most significant trends in the UK used car market.
Head of Valuation Services at My Car Check Trade, Gavin Amos, commented: “With the dust having settled following the general election, and the Conservatives in a position to implement their full manifesto, it will be interesting to see how the new and used car markets fare over the coming months. In particular, how will manufacturers, dealers and consumers react in the run up to the referendum on continued membership of the European Union?
“June is traditionally a fairly quiet month for used car buying, although the old soft-top cliché is true to a certain extent – demand does increase for something to enjoy during the summer months, and values always reflect this. With virtually all manufacturers now having an SUV option, it is no surprise that this sector remains especially strong, with the Nissan Qashqai leading the mid-size market.
“Looking ahead, there are some stunning new cars on the way across several key market sectors. This should benefit the new market in the short term and the used market as they filter through.
“There is currently plentiful stock in the used market and this trend looks set to continue. This is largely a result of the boom in PCP finance deals over the past few years. We are seeing more good condition two to five year old cars across all sectors.
“It is fairly well documented that the new market, which is predicted to achieve 7-8% growth this year, is being manipulated to some extent by manufacturer activities. While we continue to see month-on-month increases, you have to ask how much of this involves true retail sales. That said, PCP is undoubtedly a factor in the new sales success story. For many buyers, it is the only viable way to fund a new car. With the stability of outlay, in terms of monthly payments and, perhaps equally importantly, service costs, PCP will continue to be a huge influence on both the new and used markets for years to come.
“While PCP deals have caused nearly new values to suffer, they have also created a guaranteed supply of used cars. The shift to a regular change cycle has certainly eased stock shortages, so often the bane of the used market. The key issue looking forward will be increased scrutiny in terms of condition, mileage and specification. Demand is likely to remain firm for used cars, though the difference in value between high and low mileage examples is likely to grow.”