July Car Market Report

Used car market remains strong as we head into Q3

Black car

The used car market remains steady and stable despite external market pressures, new data released today by Cox Automotive has revealed.

The data, an overview of the July marketplace, signalled a positive upturn in demand for ready to retail vehicles, offering dealers and vendors positivity as we head towards Q3.

Manheim, the UK's leading provider of integrated products and services for the vehicle remarketing sector, continued to show strong increases in the price of sold vehicles, up 7% to £7,298 (from £6,816 in June) - a 15% increase on the same period last year. Volumes of vehicles coming through the lanes also remained stable, in line with the previous month.

Dealer Auction, the trade-to-trade online auction platform, also reported a 2% month on month increase in the average selling price of vehicles to £4,630, in addition to a 10% increase in volumes through the online lanes.

Commenting on the figures, Cox Automotive's Philip Nothard, said: "We're not surprised average selling prices are being pushed up, something we expect to continue over the coming months."

"As the market remains steady in terms of volume, demand for vehicles is heating up and dealers are now willing to pay more for quality vehicles that match their requirements. They want clean, tidy stock with good mileage that they can list quickly, and which they know will attract drivers for a quick sale, and so vendors will do well to ensure their pre-auction checks are thorough before entering their vehicles, in order to achieve the maximum sale price possible."

The Manheim data also revealed a strong demand for Ford Focus, Vauxhall Insignia and Vauxhall Astra models up to 10 years old with mileages below 50k, alongside a significant increase in the demand for convertibles coinciding with the hot weather.

Rounding off wholesale figures, NextGear Capital, Cox Automotive's wholesale stock funding business, also reported steady figures across the board. The average cost per unit increased to £7,529 (from £6,837 from July 2017), while average holding days increased slightly from 56.8 to 58.5.

In the retail market, Cox Automotive's car search platform, Motors.co.uk, continued to report stable figures, with the average sold price of vehicles up 1% to £14,314 (up 6% year on year).

In line with the previous month, diesels continued to perform well, selling three days faster than the same period last year despite ongoing negativity surrounding the fuel, while petrols continued to stall, held on forecourts for an average of 52 days compared with just 48 in 2017.

Nothard continues: "Dealers are reporting a slowdown in footfall over the past two months, although this is to be expected during the holiday season and with the hot weather we have experienced."

"Looking at footfall more closely, independents are selling vehicles three days faster on average than this time last year, with supermarkets taking an extra four days to sell stock compared to July 2017. Although, this could be temporary and down to an average 15% stock volume increase at supermarkets currently outweighing the summer demand."

"Going forward, it's a given that the WLTP will hit hard over the coming months, especially in terms of stock availability, so it will be an interesting time for all involved. However, while we expect some peaks and troughs in terms of supply and demand, we are confident the market will steady itself, especially given the positive half year to date."

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