‘Worst is over’ with used car values heading towards stability

Staff
By Staff
3 Min Read

Most dealers say used car prices and values are heading towards stability although more than eight out of 10 used car dealers (84%) still expect them to continue to fall this year, new research shows.

The March Startline Used Car Tracker says that one in five (20%) think the rate of fall will accelerate, 28% believe they will continue at the current speed, and 36% that they will be less severe.

Paul Burgess, CEO at Startline Motor Finance, said: “Over the last year, used car prices and values have fallen by about a fifth caused by factors such as gradually increasing stock supply and reduced consumer demand.

“The general view on this has been that prices and values were inflated to a very high peak and that some form of readjustment was always going to come. The question for dealers is how far the market is going to ultimately fall?

“Our findings are that dealers generally don’t think the realignment is over. Although there is some disagreement over how far things could yet fall, the majority view is that the worst is over, which is we agree is the most likely situation.”

However, Startline’s research also shows 16% of dealers think that the situation has stabilised and the same number (16%) believe that prices and values will start to rise.

Burgess said: “We’re also seeing a significant minority in the Tracker results who believe that prices and values are now stable and could even rise. Seeing differing sentiments of this type perhaps underlines that there is a degree of uncertainty in the used car market.

“Interestingly, 8% of the dealers we questioned also think that the market is returning to something more like before the pandemic and we broadly agree with that sentiment. We are probably seeing the return of something that would in historical terms be considered much closer to a normally operating used car market with prices becoming more affordable.”

The Startline Used Car Tracker is compiled monthly for Startline Motor Finance by APD Global Research, well-known in the motor industry for their business intelligence reporting and customer experience programs. This time, 304 consumers and 61 dealers were questioned.

Share This Article
Leave a comment

Leave a Reply

Your email address will not be published. Required fields are marked *