A strong end to the year

Cox Automotive weathers December, closing 2017 on a high

Data released today by Cox Automotive reveals a strong end to the year for the used car market, with prices up, despite December's adverse weather conditions.

Figures obtained from Manheim's online and physical auction lanes reveal that average sale prices surged 2.1% in December (a 4.4% uplift on 2016), to £6,639. Adding to the positivity, average mileage across vehicles sold remained steady at 58,331 (a minor 0.8% decrease on November).

Cox Automotive's Philip Nothard said: "The uplift in pricing can be partially attributed to falling volumes through our lanes which has created a very competitive marketplace."

Philip Nothard, Head of External Relations CEO Michael Buxton with Philip Nothard, Head of External Relations

The bad weather experienced across the country in the early part of the month, paired with the expected seasonal downturn over the Christmas week, affected volume through the lanes, and saw a 41% decrease against November (8.6% decrease year on year). This was driven by a drop in part-exchange (down 44.5%) and ex-fleet (down 36.8%) volumes.

Further reflecting the positivity in price, Dealer Auction, the UK's largest trade-to-trade online auction platform, reported a 2.1% month-on-month increase in average sales values, with volumes over the year remaining static and in line with annual expectations.

Continuing the trend, NextGear Capital, the wholesale stock funding business saw the average cost per unit hit £7,170, a 3% monthly growth and the highest figure recorded in 2017. The average holding days however, decreased to 53 days, from 57 in November.

The consumer market also flourished in the final month of the year, indicating a positive end to 2017. The group's car sales website, Motors.co.uk, revealed a solid month in terms of price, with average sold prices up 9% year-on-year, and 1.3% on November, at £14,465.

"The difficult second week, where the market was virtually obliterated by the heavy snowfall, was a clear factor in falling volumes," said Philip Nothard, Head of External Relations at Cox Automotive. "As a result, many dealers reported that business was highly competitive during the month."

"The increase in prices seen through the lanes can be partially attributed to a fall in the volume of vehicles coming in, and as the used car market continues to gain pace, dealers have been willing to spend more on stock to meet their customers' needs."

Looking to the year ahead, Nothard said: "We anticipate a spike in both demand and prices for used cars over the next month, and as seen in 2017, predict these increases will be maintained for the first quarter, with all fuels performing well.

"Our data shows that the downward trend in the new car market for diesel has yet to fully filter through to the used car market, despite the media negativity and Government push for consumers to buy alternative fuels. For used cars, we believe diesel will remain a top player in the market for a considerable number of years to come.

"Dealers that have already planned and managed used stock for the upcoming months are positioned well, but those reliant on new could find themselves on difficult and hyper-competitive ground."