Used car sales were down 8.9 per cent in the first three months of 2021 as lockdown stifled the market, according to the automotive trade body.
Over 1.68million second-hand cars changed hands in the opening three months of the year, falling from 1.85million in the same period a year ago, which was ended by car showrooms being told to shut on 23 March 2020 as Britain went into lockdown.
This year’s sales came despite car dealers once again being forced to close their doors to customers throughout the opening three months of the year.
However, they could operate socially-distanced click-and-collect or home delivery sales, leading many to get creative to keep selling cars.
Industry bosses said it is ‘vital’ that the used market is rejuvenated to ‘help sustain jobs and livelihoods, drive fleet renewal and support environmental progress’
New figures released on Tuesday by the Society of Motor Manufacturers and Traders show that second-hand motor sales were down more than a quarter (27.1 per cent) in the first month of 2021, while February saw a decline of almost a fifth (19.4 per cent).
There was a 32.2 percent growth in March, though the data is heavily skewed by last year’s slump in sales as the impact of the coronavirus pandemic first took hold in March 2020
A comparison to the first quarter of 2019 shows second-hand car sales down by 16.5 per cent, with 332,389 fewer used models finding new owners.
Car dealers were allowed to reopen on 12 April 2021, along with other non-essential retailers.
Records show that the used market is still almost entirely dominated by petrol and diesel sales, accounting for 97 per cent of all transactions, and buyers’ appetite for diesel vehicles and their values seem to be bucking a cliff-edge fall in new car demand.
Mike Hawes, SMMT chief executive, said the latest figures ‘lay bare the turbulent impact of coronavirus lockdowns on the used car market’.
However, he added that March’s performance suggests there could be some pent-up demand as a result of people returning to the road and life edging closer to normality as lockdown restrictions ease.
‘The second quarter will see significant growth as last year’s April and May markets were severely limited by lockdown measures,’ Hawes explained.
‘It’s vital that the used market is rejuvenated to help sustain jobs and livelihoods, drive fleet renewal and support environmental progress.
‘With car showrooms open again and the UK coming out of Covid restrictions, the sector can look forward with renewed optimism.’
Used car transactions fell by almost 9% in the first 3 months of the year, but with lockdown measures easing are expected to surge in comparison to 2020 figures in the second quarter
Ian Plummer, commercial director at Auto Trader, said the second-hand market could see a spike in demand as a result of supply issues of new cars, which are likely to be hampered by the much-reported shortage of computer chips in recent weeks
Auto Trader – the UK’s largest used car market place – was upbeat about the figures, describing the stats as ‘very positive’ and highlighted the ‘success retailers made of their buy online channels’.
Ian Plummer, commercial director at Auto Trader, said the second-hand market could see a spike in demand as a result of supply issues of new cars, which are likely to be hampered by the much-reported shortage of computer chips in recent weeks.
Used electric cars are in short supply
The Ford Fiesta is by far the most popular second-hand model in the UK
The SMMT’s figures for used car sales paints a very different picture to new motor registrations.
While demand for brand new alternative fuel vehicles is booming currently, not enough of older models have yet hit the used market for there to be a significant growth in transactions.
Demand for electric cars was up 48.3 per cent year-on-year, though this accounted for just 6,500 of the 1.68million used models purchased in the first quarter.
Hybrids were up 16.6 percent and plug-in hybrids rose 32.1 percent to more than 10,500 vehicles.
It means petrol and diesel vehicles still account for a massive 97.1 per cent of all second-hand motor transactions, with the Ford Fiesta the most-bought model with almost 73,000 transactions.
Karen Hilton, chief commercial officer at heycar, says its records suggest it is owners of vehicles between six and eight years old who are most likely to buy right now – and diesel is in greater demand than you might think.
There is a significant portion of car-buyers who may be looking for one last hurrah with diesel
While new registrations of diesel cars are down a third and account for just over one in 10 new models bought in 2021, demand is surprisingly higher on the second-hand market.
‘Diesel vehicles continue to perform strongly against expectation,’ Hilton explains.
‘Average prices are now up by 16.5 per cent since January 2020, with petrol increasing by just two per cent.
‘It suggests there is a significant portion of car-buyers who may be looking for one last hurrah with diesel before they make the switch to EV or petrol-hybrid.
‘Average lead prices for diesel convertibles, for example, have increased by 36 per cent since the pandemic with SUVs up by 12.2 per cent.
‘With the summer months promising the end to all coronavirus-related restrictions, there are abundant reasons to be positive as dealers build their business back.’
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