| Retailers have been urged not to cut prices when the second national lockdown is introduced on Thursday.
The NFDA and Auto Trader have both insisted that demand remains strong and cutting prices would be a misguided step.
The Auto Trader’s Retail Price Index found that, based on pricing analysis of circa 900,000 vehicles, average prices increased in October for the third month in a row, with the average retail price of a used car at £14,014. This is an 8.6% year-on-year (YoY) increase on a like-for-like basis and marks seven months of consecutive growth.
Looking at October’s pricing data on a more granular level, it’s clear the price increase is being driven by the exceptionally high levels of growth in both used petrol and diesel cars. Last month the average price for a second-hand petrol car grew nine per cent year-on-year, while used diesel cars saw prices grow 8.8%, which marks the fourth consecutive month of record price increases.
Alternatively fuelled vehicles (AFVs) also saw a positive October, recording the first price growth since February 2020.
Auto Trader’s director of data and insight, Richard Walker, said: “The introduction of the second national lockdown in England and the 17-day firebreak in Wales is disappointing for us all, but not surprising given news over the last few weeks. Fortunately, businesses are far better prepared than they were in March and despite the restrictions, our data suggests consumer demand remains strong. As we stressed during the original lockdown, retailers should avoid the temptation to slash their prices in order to entice car buyers, as it simply isn’t necessary and could have a lasting negative impact on the market.”
Sue Robinson, NFDA chief executive, added: “It is encouraging to see that average asking prices saw an increase in October demonstrating that consumer demand for used cars remains healthy, in particular, for petrol and diesel vehicles. Despite the introduction of new restrictions, dealers have been receiving high volumes of online enquiries and this is likely to continue over the coming weeks.” |
