Confidence among used car retailers is higher now than at the start of the year as sales figures continue to rise, according to new research.
A study by CAP of 100 independent used car sellers revealed that an improved balance between supply and demand meant that prices of used vehicles have fallen, in turn boosting sales. At the start of the year, a shortage in supply had seen prices rise and sales suffer as a consequence but this trend has since been reversed.
The growing sales of used cars is, naturally, positive news for the motor trade industry as it will boost the revenue of not only the companies selling used vehicles but also the independent garages and mechanics that do repair works or servicing on them. As with any surges in business, it is important that firms ensure their motor trade insurance policy will cover the additional business they could be undertaking this includes the number of vehicles under their care as well as a potential rise in the size of their workforce.
This study into used car sales was conducted as part of research for Black Book Live, CAP Automotive\’s unique real-time used car trade values trending tool, used by businesses across the industry. It found that not only are sales increasing, although by exactly how much is yet to be revealed, but so is the amount of high-quality stock dealers have access to.
At the start of the year there was a reported shortage in high-quality used cars, but the latest figures now show the smallest proportion of dealers struggling to source the right cars for their forecourts than since August last year. Indeed, CAP\’s survey showed that every measure of dealer performance is currently positive, with stronger month-on-month retail sales and a 16 per cent improvement on the end of last year.
CAP communications manager Mike Hind said: Although used car retail sales have been good for independent dealers this year, profitability was proving a real challenge because of the increase in wholesale values caused by strong competition for the best quality stock.
Now they appear to have come to terms with the higher prices and are once again enjoying the fact that retail demand is keeping the metal moving.â€
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