It is a fascinating time in the motor trade industry right now with some startling statistics that reflect what is happening in a broader sense in the UK. The economic and political climate in this country has created a storm in the auto industry, with new car sales plummeting and the sale of used automobile holding steady to become the most popular option for consumers right now.
In fact, it has recently been announced that new car sales have fallen for the seventh consecutive month this year. The Guardian reports that sales have dropped by 12% compared to October last year, with diesel falling by a staggering 30% last month. The used car market, meanwhile, remains level for the year despite a slight dip of 2.1% in the third quarter (July to September) according to Motor Trader. The second-hand market has managed to remain stable thanks to a bumper first quarter, so it is in good health thanks to deals on low emission and alternatively fuelled vehicles.
The reasoning for these turbulent statistics comes down to the confusion over the Government’s clean air plans, the uncertainty over Brexit and the current economic climate. This has all created a serious lack of consumer confidence where the public is not willing to make big financial decisions. This is why the new car market has suffered a heavy blow, whilst the second-hand market has managed to remain stable as it is the safer option for consumers.
The electric car revolution
It does seem that the public is starting to prepare for the 2040 petrol and diesel ban, with the T-Charge rollout and Oxford announcing that they will be bringing the ban forward to 2020 only strengthening the case for making the switch to electric vehicles sooner rather than later. For those that are currently looking to make the switch, it is likely that they will be looking to the used car market first as there are many now available here for affordable prices.
Demand for AFVs
This can already be seen in used car retail statistics from Motor Trader, as the demand for alternatively fuelled hybrid and electric cars rose 17% in the third quarter with pure electric automobiles seeing sales rise an amazing 66.4%. Despite this, petrol cars remained the fastest-selling off forecourts in October. The quickest was the Ford Ka, which took an average of 17 days to sell. This was followed by the Peugeot 3008 (18 days), the Kia Sportage (19 days) and the Toyota AYGO (19 days). There were just two diesel models to break into the top 10, which was dominated by hatchback’s which made up 7 of the top 10.
Navigating the used car market
It is clear then that UK motorists are looking to the used car market before the new one due to the current political and economic climate. Therefore, it is expected that an increasing amount of motorists will be processing car checks to gain a better understanding of the automobile’s past.
Whilst the used car market is favoured by the public right now, it is also a market that is famously plagued by fraudulent sellers and scams. These checks obtain records from a range of important bodies and can determine whether or not it was stolen, if there is outstanding finance, if it has been previously written off, if it is a clone amongst various other important factors. HPI find that 1 in 3 used cars has some kind of hidden past, so it is vital that consumers protect themselves in the used car market by getting these checks carried out.
Currently, it’s easy to see these trends continuing into next year and at least until there is more certainty over what Brexit will bring in March 2019. Consumers will not want to make large financial decisions, so they will turn to the used car market when the time comes to obtain a new automobile. With so much media attention on clean air plans and the increase in charging points up and down the country, the increase in electric vehicles sales looks set to continue as the public embrace the electric car revolution. Whilst some will buy new when making the switch, it is likely that the majority will look to buy second-hand as this can make it much more affordable.
(A Retail Times’ sponsored article)