Used car demand fell 22.1% year-on-year in the second lockdown, although the market is expected to see strong demand over Christmas and into Q1.

Used car prices fell by 2.1% in November but are up 0.3% in the early days of December

The data from Indicata shows prices also fell, down by 2.1% between the end of October and November as dealers turned to online sales while their showrooms were closed. The price reductions came on the back of a 2.6% month-on-month increase in stock levels during November, which lead to dealers reducing prices to avoid ending the year with high levels of stock.

The price fall was the first the market had seen since the spring and the first lockdown, indicating the strength of the used market when it has been trading, and has been followed by a 0.3% rise at the start of December post-lockdown.

Some dealers have also continued buying cars at reduced lockdown prices in preparation for a strong end to December and start to January.

“We saw our online wholesale portal stock levels rise during November but not dramatically as many dealers have been investing in new stock at the lower lockdown prices,” explained Jon Mitchell, group sales director Indicata.

“While prices did fell during November our Indicata insights have already seen a rise of 0.3% again in the first few days of December as dealers come out of lockdown.”

Meanwhile, demand for EVs and hybrids slowed for the second successive month as consumers looked towards petrol and especially diesel for better value. Dealer stock turn of diesels was 6.2 during November compared with 2.8 on EVs, indicating that dealer pricing will have to reduce on alternatively fuelled cars to ensure they remain competitive.