Retailers leaving £31m on the forecourt
Data from Auto Trader has suggested that retailers are missing out on a potential £31m in profit due to under-pricing.
It found that across 8,000 retailers, about 47,500 cars are being advertised below their respective retail market average, meaning retailers could miss out on £4,000 in potential margin.
Demand remains robust, but supply remains constrained with the volume of available stock increasing just 0.4% on January. However, according to the Auto Trader Retail Price Index, the average used car retail price at the mid-month point is £17,108, down 6.2% year-on-year on a like-for-like basis. This marks the fifth month of contraction.
Richard Walker, Auto Trader’s data and insight director, said: “Demand is robust, cars are selling quickly, and early indicators point to an uptick in transaction levels, so retailers should feel optimistic for the year ahead. Although we are seeing a slight slowdown in the volume of cars being underpriced, it remains at an alarmingly high rate. With these favourable market dynamics, trade and retail prices being out of sync can represent an opportunity – I strongly encourage retailers not to miss it.”
