Used prices continue resurgence in May

The average price of used cars rose by nearly two per cent in May compared to the same month last year.

This is according to data from Auto Trader’s Retail Price Index, which is based on pricing analysis of about 900,000 vehicles every month. It found the average price of a used car in May was £13,931, up 1.9% on May 2019.

The increase in used car prices was driven by the strong performance recorded in the internal combustion engine category, especially petrol, which continued its upward trajectory. It rose 3.3% to an average price of £12,707, while diesel rose 0.9% to £14,736.

However, alternatively fuelled vehicles continued to contract last month, recording a 1.5% year-on-year decline.

Richard Walker, Auto Trader’s director of data and insights, said: “Given the negative impact it could have had on the financial health of the market, it’s a huge relief to see that despite the huge pressure over the last 10 weeks, retailers have remained firm and resisted the urge to lower prices. And with consumer demand surging this week, it’s clear it was absolutely the right decision.

“The reopening of showrooms in England this week marks an important first step on the industry’s road to recovery, but with trade auctions remaining closed, the challenge retailers currently face will not be selling cars, but rather restocking them. Such high levels of demand, coupled with a low level of supply, retailers can afford to continue holding firm. Retailers should be confident in their pricing and use accurate and up to the minute data, tools and insight to back up their pricing decision.”