Used car prices are set to continue rising at an ‘unprecedented’ rate this summer, predict experts monitoring the secondhand car industry.
Prices have already been going up by almost double-digit percentages in recent months, says Philip Nothard, chair of trade body the Vehicle Remarketing Association.
Such healthy price rises are now set to continue into the summer months as experts from Auto Trader, CAP and Cazana warn they have “never seen anything like the current conditions”.
Car buyers are warned dealers are facing a “perfect storm, where stock is in very short supply, demand is high, and buyers are ready to spend freely”.
This is leading to fast-rising prices, cars flying off forecourts quickly… and improved margins for dealers, too.
“There is a general view that dealers could be even braver when it comes to higher pricing,” said Nothard.
That’s if they can get cars, he added: “Many dealers are having so much trouble getting hold of stock that they are retailing almost everything they take in part exchange.”
This means some nearly-new specialists might now happily be selling 10-year old cars.
The current situation, however, cannot continue, adds the VRA.
“At some point, we will see a levelling off of values as supply increases and demand normalises.”
This does not appear to be imminent – but when it does arrive, the industry will need to keep a close eye on any readjustments.
“The danger is that dealers could be left holding stock that is falling rapidly in value – but, so far, there is simply no sign of that occurring.”
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