Autotrader expects 2026 to be a genuine inflection point for the UK car market – not because volumes suddenly roar back, but because the mechanics of supply, stock mix and profitability will shift in ways that retailers cannot avoid.
Marc Palmer, Autotrader’s head of strategy and insights, says there are three forces coming into play.
Supply shortage moves beyond 3-5-year-old cars
The first is familiar: the fight for supply. What changes in 2026 is the battleground on which that fight is staged. For the past few years, shortages have been most acute in the younger used bands, particularly the 3-5-year-old sweet spot on which franchise retailers and larger independents rely.
From 2026, Palmer expects the shortage to move into the market’s core, catching far more retailers who have so far been insulated by older stock profiles.
That shift is easiest to see when you map the parc forward. The market’s high volume years, 2015 to 2017, created a deep pool of vehicles that has been flowing through the age cohorts ever since. But the weaker registration years from 2020 onwards created a missing volume that does not disappear. It simply travels as those vehicles age.
In 2019, there were almost 5 million 3-5-year-old cars on UK roads. Recently, that figure has been nearer 3 million, effectively removing around 40% of the available supply for retailers specialising in that cohort of cars.
Many have felt that pain already. Cars have been harder to source, forecourts harder to fill, and buying has become more competitive and more expensive as a result.
What is new is that the squeeze now starts to bite the next band along.
The 5-10-year-old cohort has been stable at around 11 million for the last couple of years, which is why many independents selling those cars have not felt the shortage in the same way.
But Palmer expects that to change quickly. As time moves on, the 5-10-year-old cohort is set to fall materially, with the sharpest impact landing in the 5-7-year-old zone.
In practice, that means far more businesses will be chasing the same metal at auction, leaning harder on part exchange, and competing aggressively for any stock that comes back into the wholesale market.
EVs: here to stay
The second force is that 2026 is when used EVs go mainstream – not as a niche segment, but as an unavoidable part of the available supply.
In 2024, only a small proportion of the relevant cohorts were electric, but by 2026 and 2027, Palmer expects around one in five of cars to be EVs. That changes the used market in two ways at once.
Retailers are not only battling to secure vehicles. They are increasingly battling to secure the right kind of vehicles, while the stock that is available will demand a different way of retailing.
Autotrader’s market indicators suggest that shift is already under way. EVs currently make up roughly 10 to 15% of advertised stock, while EV share of enquiries sits a few points higher and has been rising through 2025.
Normally, those lines converge towards year-end as extra supply hits the market, with pre-registered and September plate cars boosting used availability into Q4.
This year, that late-year supply swell has been weaker than in previous cycles, raising the possibility that demand could remain ahead of supply at the turn of the year. If that holds, it is a constructive setup for used EVs going into Q1 2026.
Speed of sale
The more immediate cause for optimism, though, is in consumer behaviour rather than just shares. EVs have moved from being one of the slower turning fuel types in early 2025 to the fastest selling over recent months.
Palmer says this is not just the market fixing itself. It reflects how quickly some retailers have professionalised around EVs.
Over the last year, several big independents and car supermarkets have leaned in hard.
They have trained teams, added on-site charging, built processes for customer education, and priced stock with confidence. They have been buying more used EVs and pushing them through quickly with aggressive, disciplined pricing.
Steady prices
Price stability is the other supportive sign. Used EV retail prices have been relatively steady month on month over the last six months, broadly in line with the wider market. Palmer however acknowledges the nuance beneath the headlines.
Stability at a market level can sit alongside real pain for certain operators, particularly those exposed to specific models or to residual value risk in leasing channels.
Autotrader’s analysis shows how uneven the value story can be: a retailer heavily weighted to models that have corrected sharply will naturally feel bruised, while those selling more resilient products will have a calmer time of it.
Here, there is also a noticeable split by launch timing of models. Models launched pre 2023 have tended to take a heavier first-year hit than later launches, while newer generation EVs appear to make their adjustment early and then behave more normally. The market went on to reset in early 2023, when retail prices dropped and expectations re-based.
Making EV the niche
The third force, Palmer argues, is profitability, and it is the one that links everything together. The assumption that the market will grow to the numbers a dealership needs will prove harder to sustain in 2026.
If volume growth is not there, trying to live on thin, normal returns becomes a risk rather than a plan. For many groups, a 1.5 to 2% return on sales will be difficult to sustain without a market tailwind.
The winners will be the retailers that accept the new reality early, recognising where stock is scarcer in the age cohorts that matter to them and that EVs will account for a rising share of available cars.
Nathan Coe, Autotrader’s CEO, puts it bluntly. “Retailers can choose their pace on EV, but they cannot do nothing. The supply drop is coming and a larger share of what comes back will be electric.
“The mistake is arriving at that moment unprepared, turning up at auction, finding there is nothing you want, and realising too late that the stock mix has moved on.”
In Detail: Mapping the UK car parc over time
The key idea behind Autotrader’s graphic representation of the car market age profile is that each year’s new registrations flow down through the chart as those cars get older – moving into the next age cohort row as time passes. The heat colours show relative annual volume: red – lowest supply, dark blue – highest supply.
In 2020, the pandemic-hit market was around 1.6 million new registrations which was followed by several years of similarly subdued volume. Compare that with 2015-2017, when the market was closer to 2.5 million a year.
A red year created by weaker new car sales doesn’t stay at the top – it moves through the parc, becoming a shortage first in 3-5 year-old cars, then later in 5-10 year-old cars, and so on.
What this means in the 3-5 year-old car market
In 2019 which was the last full year before the pandemic, there were almost 5 million cars aged 3-5 years on UK roads. In recent years, that figure has been closer to 3 million – a drop of around 40%.
For the many franchise dealers and larger independents specialising in 3-5 year-old stock, that’s meant a sustained squeeze: fewer cars available to buy, and constant pressure to keep forecourts filled.
What this means in the 5-10 year-old car market
By contrast, the 5-10 year-old cohort has sat at around 11 million for the last couple of years. That’s why many independents focused on 5-7 year-old cars didn’t feel the immediate shock – the “missing” new-car years hadn’t reached their part of the parc yet.
But the graphic shows that that’s about to change. The 5-10 year-old cohort is set to fall to just over 9 million next year and then keep declining for several years.
That tally of 2 million fewer cars implies a material change in supply for much of the retail market.
And it’s even sharper within the comfort zone of many independents: 5-7 year-old cars, where the drop is expected to be close to 1.5 million fewer vehicles year-on-year.
That is the delayed but powerful effect of the new-car market slump: the shortage moves through the parc – and the pinch shifts from younger used cars into older used cars through the second half of the decade.
Palmer advises: “We know that the supply drop is coming, and we know that what’s coming back is electric so we say, do what you like – but have a plan. The point is – have a plan.”
Product mix changes
There’s another trend this next chart highlights: it’s not just the number of cars that changes – it’s the mix.
In 2024, very few of the roughly 4.5 million cars moving through this part of the parc were electric. But by 2026 and 2027, the cohort looks very different: around one in five of those cars will be EVs.
That means retailers aren’t only facing a supply shift – they’re facing a product shift. The challenge becomes twofold: availability: fewer cars to source in key age bands; and type: a much higher proportion of EVs entering the mainstream used pipeline.
In practical terms, “getting hold of stock” increasingly also means being set up to retail a different kind of stock – requiring a real change in mindset across buying, pricing, preparation and customer handling.
Palmer at Autotrader says: “Franchise retailers have sold electric cars used because they probably sold them new and they’ve got salespeople that know the product, know what to do, can answer the questions, and can handle EV retail.
“But now, as that used EV supply returns, and the proportion of electric cars within that grows, those retailers that have never sold a used electric car – and it’s still four in five independents that haven’t — will need to simply because EVs will represent an increasing proportion of the available cars to sell.”
“It’s an interesting one, because a franchise retailer gets product training from the manufacturer, but if you’re an indie, don’t get any of that.
“All of a sudden, a load of your available cars will be different, different brands, different fuel types, different ages, all of your experience is suddenly no longer means as much so independent retailers will have to pick it up quickly, which is where information will be important.”
Where the used EV market is right now
Because the UK used car market is dominated by older vehicles (6-8+ years), the EV share of the total used parc is still relatively small. So to understand how EV expertise can give any dealership right now, it makes sense to focus on the parts of the used market where EVs are actually present in meaningful numbers – and then compare stock versus demand.
On this chart, the black line represents the EV share of advertised stock – currently sitting between 10% and 15% and the red line indicates EV share of customer enquiries on Autotrader’s online marketplace.
This is running around three percentage points higher than stock right now, and rose steadily through 2025.
The encouraging signal is the gap between those two lines which suggests demand is running ahead of supply in used EVs – and that gap has been narrowing in a predictable way each year.
What’s different this time? Historically, the two lines converge at the end of the year. That’s because a lot of additional supply hits the market in the final quarter – driven by pre-registered and recently registered cars flowing into used channels, and help push stock volumes up.
This year, that late-year surge in supply did note come through as strongly as it has in previous years. If that holds, Palmer suggests it could be the first year where used EV demand stays ahead of supply into year-end, which would be a genuinely positive setup heading into Q1 2026 – supporting faster turns, firmer pricing and a healthier market dynamic for used EVs.
What’s positive in used EVs right now?
The optimism shows up most clearly in days to sell.
On this chart, EVs are the red line. Earlier in the year, EVs were sitting towards the slower end versus other fuel types. But over the last few months, EVs have moved to become the fastest-selling fuel type in the used market.
Part of the shift is down to who is selling the cars. From late 2024 and through 2025, a number of big independents and car supermarkets have made a deliberate push into EVs.
They’ve trained sales teams properly on EV ownership and charging questions; invested in on-site charging infrastructure and taken a genuinely strategic approach rather than treating EVs as awkward exceptions.
The result is they’ve been buying up a greater share of used EV stock and using a model that works, price the cars aggressively and turn them quickly. So some of the improvement in EV days-to-sell is being driven more by independents than by the franchise channel.
That’s a positive signal for the future: it shows the market can work well when retailers commit to the category and get operationally set up for it.
The other good news? Pricing has stabilised. On the right-hand side of this graphic, you can see another improvement: used EV retail prices have been broadly stable over the last six months of 2025, moving month-on-month in a way that’s more in line with the wider market.
So, the overall outlook for used EVs looks more positive than it has for a couple of years: faster selling and steadier retail pricing.
One caveat worth flagging is that while at a market-level the pricing picture looks healthier, it doesn’t always feel that way for everyone.
Palmer says Autotrader still hears – particularly from the leasing sector – that values and future values remain a concern. In other words: retail indicators may be improving, but parts of the wholesale side of the market are still uneasy with the headline market trend masking big differences by model, age band and supply source.
Palmer reports: “When we do the analysis, what we find is that if you’re exposed to certain products, If you’re selling 50 EVs, 25 of which might be Porsche Taycans, then you’ve probably got to much exposure, and you would be worried about it. But if 25 of them are Minis, then you’ve not got anything to worry about, because after a year, they’ve retained a lot more of their value.”
Autotrader CEO Nathan Coe adds that many independent dealers were early adopters of EVs, although some were “totally bitten” by subsequent price adjustments, citing one dealer who suffered around £600,000 in write-downs and, as a result, decided he was “never going near this rubbish ever again”.
Safety in numbers
The number of retailers selling electric cars has also increased year-on-year, pretty much driven by independent retailers.
“So that’s a positive sign,” says Palmer. “It’s still a long way from where we need it to be in the next year. The number of independent dealers should be – given the supply picture – well over 2,500.
Autotrader’s chief Coe concludes: “As we look forward, we feel like the market will continue to be pretty good. Pricing looks pretty stable. We’ve got more supply coming through as new cars start to feed through.
“But interestingly, that fight for supply switches pretty much in 2026, such is the shortage now in those 5-7 year-old cars. So even if you’ve been doing really well over the last couple of years, if you keep doing the same thing, you might not get exactly the same result.”
