LIVE valuation data from used vehicle price experts cap hpi, says that Lockdown 3.0 is having a negative impact on used values.
This comes after a period of sustained trading from March to October where used values defied gravity.
Nevertheless, Lockdown 2.0 saw prices edge down and the same is happening now – on average by 1.4% or £150 – despite many retailers reporting they felt business was brisk considering the lockdown.
However, retail business levels are running at between 50-70% of January 2020 levels, says cap hpi, and the volume of cars sold through trade channels has been at around 60% compared with January last year.
Our live trending evidence shows the used car market is certainly open for business, but at a reduced level to ‘normal’ times. With ‘click & collect’ and ‘click & deliver’ still permitted, consumers are still purchasing, albeit to a lesser degree than previous years because of the government’s advice.Derren Martin, head of valuations, cap hpi
Martin said that the pandemic was directly responsible for the decrease, causing the January anomaly, which normally sees values remain steady as demand increases. He added:
With many buyers on furlough and dealers all stocked up from December, in preparation for January, we now see retailers in less of a mood to buy as their stock isn’t flying off the forecourts in the quantities seen last year and there’s less of a need to dip into the trade to replenish it. Uncertainty over when this lockdown will end and what happens immediately following that has also dampened their enthusiasm.
Which cars have been hit hardest by the fall?
The vehicles showing the greatest vulnerability to price drops are MPVs, which have been losing value since October reports cap hpi, down 2.2% or some £250. Worst affected are the Ford Galaxy, SEAT Alhambra and Vauxhall Zafira – all have dropped by more than 4%.
cap hpi also says that electric vehicles and hybrids also remained under more pressure than their petrol and diesel equivalents, due to supply levels increasing and an unwillingness by consumers to pay the current premium on advertised prices compared with ICE equivalents.
Our live data feeds show there is plenty of fluidity in market values across all segments and whilst the used car market and used car dealers have proved themselves to be a robust part of the economy, prices are not immune to the dynamics of supply and demand, despite remaining open for business virtually.
Meanwhile supercars are being snapped up
A report in the Financial Times said that luxury car retailer HR Owen was experiencing a boom in second hand supercars. According to the paper, buyers who have been unable to go on exotic holidays were spending their cash on second hand supercars, up to the £150,000 mark. HR Owen said it expected the boom to continue for the foreseeable future.
Automotive and fleet writer for Broker News