Used car demand outstrips supply
Used car performance has remained strong since dealers opened on 1 June, notably with a surge in demand for older models and hampered by a shortage of stock for newer cars.
Latest figures from Indicata show a 3.7% rise in sales of six- to 12-year-old cars in June 2020 compared with June 2019.
Sales of cars aged 6-9-years old and 9-12-year old rose by 12.6% and 8.6% respectively, while the 0-3-year-old sector fell by 7.1%, largely on the back of a shortage of stock in the sub 12-month sector.
SUVs, sports and luxury cars continued to be in high demand while mini and small car sales fell by 4.7% and 3.6% respectively.
Indicata also noted that demand has continually exceeded supply; wholesale stock is still stuck in compounds or parked on airfields, weakening supply. As a result, since dealers opened on the 1 June, used car sales have reached a seven-day rolling average of 12,000 per day which compares with the 10,000 per day dealer restocking rates. This has led to dealers being short of roughly 125,000 used cars against April levels.
“We have definitely seen a strong used car performance since dealers opened on the 1 June. Stock volumes on our online wholesale portal fell by 25% in the month so we know demand is outstripping supply,” explained Jon Mitchell, Autorola UK’s group sales director.
“We anticipate the summer months will be extremely busy with the market only starting to calm down in early autumn. The new 70-plate in September and Covid-induced PCP and contract hire contract extensions will feed additional stock into the market in autumn which should improve stock availability,” he added.