March 19, 2018

Despite market turbulence, used car values continue growth in February

Lap top
  • Average price of a used car increased 6% year-on-year (like-for-like) in February
  • Used diesel prices increased 3% (like-for-like)
  • Diesels remain most popular fuel type on Auto Trader

 

19th March 2018, London – According to the latest results from the Auto Trader Retail Price Index, despite wider market turbulences, the average price of a second-hand car in the UK is continuing to grow. The average price of a used car in February was £12,768, which on a like-for-like basis (stripping out the impact of changes in the mix of cars being sold[1]) was a healthy 6% increase on the same period last year; the same level of growth recorded in January.

The Auto Trader Retail Price Index combines and analyses data from c. 500,000 trade used car listings every day, as well as additional dealer forecourt and website data (OEM, fleet and leasing disposal prices, in addition to pricing data from over 3,000 car dealership websites and data from major auction houses across the UK), ensuring the Index is an accurate reflection of the live retail market.

 

Used diesel value continues to grow  

Whilst new diesel registrations continue to fall, used diesels are not only holding their value, but are in fact growing. With an average price of £14,400 in February, the cost of a second-hand diesel was up 3% (like-for-like) on last year; a £476 increase.

Despite its respectable performance, the growth in diesel prices was overshadowed by the 10% year-on-year increase recorded by petrol. The average cost of a used petrol car in February was £10,733; a modest £20 increase on January 2018, but a huge £1,105 jump on February last year.

Commenting on the findings, Karolina Edwards-Smajda, Auto Trader’s Retailer and Consumer Product Director, said “Retailers will continue to face unprecedented challenges this year, not least the ongoing fuel debate and the influence of Brexit, which as our recent Market Report highlights, is affecting 61% of consumers’ buying and selling decisions. However, 2018 holds some exciting opportunities, particularly within the used car sector, the growth of which we believe will be fuelled by greater finance penetration. The average 2-3 year Personal Contract Plans (PCP) renewal cycle is driving younger and more desirable cars into the market, which in turn is pushing the average price of used cars up. This means there is huge potential for retailers to capitalise by making finance easier to understand, easier to navigate and available to consumers at the beginning of their car buying journey, not at the end of it.”

 

Used diesel popularity remains flat in February

On average, 22% of all searches that take place on Auto Trader each month are based on fuel type. In February, the share of car buyers selecting diesel when searching on Auto Trader was 53%, which was unchanged from January.

The proportion of searches for both petrol and alternatively fuelled vehicles (hybrid, bi-fuel, petrol ethanol, LPG, electric) also remained flat between January and February, representing a respective 43% and 4% of all fuel searches during this period.

Further highlighting diesel’s resilience to the negative rhetoric surrounding the fuel debate, Auto Trader’s data revealed that seven of the top 10 fastest selling used cars in February were diesels. It was a similar picture in January, with four diesels making the national top 10 list, and at a more granular level, seven of the 13 UK regions and countries tracked featured a diesel as the fastest selling used car.

Karolina continued: “Whilst the negative rhetoric that has surrounded the fuel debate over the last few years has clearly impacted the new car market, in regard to the used market, diesels have demonstrated remarkable resilience. Not only are they retaining their value, but as a fuel type, they remain the most popular on our marketplace. That’s because they are an excellent choice for many drivers who depend on their fuel efficiency for long distance and out of town driving. What’s more, modern Euro6 technology is in many cases a more environmentally friendly choice than petrol alternatives.

“With the recent news that the number of electric cars sold in Britain has fallen by a third since the start of the year, the government’s approach of demonising diesel, combined with a lack of sufficient incentives for AFVs, is not only harming the automotive industry, but also hampering their green air ambitions.”

 

Graph

 

About Auto Trader

Auto Trader Group plc is the UK and Ireland’s largest digital automotive marketplace. Auto Trader sits at the heart of the UK’s vehicle buying process and its primary activity is to help vehicle retailers compete effectively on the marketplace in order to sell more vehicles, faster. Auto Trader listed on the London Stock Exchange in March 2015 and is now a member of the FTSE 250 Index.

The marketplace brings together the largest and most engaged consumer audience. Auto Trader has over 88% prompted brand awareness and attracts an average of 55 million monthly cross platform visits a month, with circa 70% of visits coming through mobile devices.

The marketplace also has the largest pool of vehicle sellers (listing more than 470,000 cars each day). Over 80% of UK automotive retailers advertise on autotrader.co.uk.

For more information, please visit http://about-us.autotrader.co.uk

 

For more information, please contact:

Andrew Nankervis | Andrew.nankervis@autotrader.co.uk

[1] Mix is determined by Society of Motor Manufacturers and Traders segment, age of vehicle and fuel type