Positive used car outlook for the rest of 2024

Auto Trader’s latest market analysis projects a 5% rise in used car sales for the second half of the year, reaching around 7.6 million transactions. Despite a challenging supply landscape, particularly among 1-5-year-old vehicles, strong consumer demand has driven a 5% year-on-year (YoY) increase in H1 sales, with June seeing the highest consumer interest in 15 months.

However, the number of sub-five-year-old cars is expected to hit its lowest since 1995 by the end of 2024, due to a 28% reduction in new cars produced during the pandemic. This uneven loss has significantly impacted brands like Vauxhall, Ford, and Mercedes-Benz, each seeing over 40% fewer cars in this age bracket. Conversely, MG, Tesla, and Kia have increased their younger car volumes.

Retailers will need to adapt to sourcing older vehicles and increased competition for stock, as the proportion of 5-10-year-old cars on forecourts has risen. The influx of electric vehicles (EVs) also adds complexity, with EVs projected to make up a third of under-five-year-old cars by 2028. This shift necessitates retailers to reassess their stock mix and prepare for a predominantly electric future.

Marc Palmer, Head of Strategy and Insights at Auto Trader, commented: “2024 has had its challenges, but overall, it’s performed well, and based on the current trajectory our outlook for the rest of the year remains positive.

“However, the heavily nuanced market retailers have had to manage over the last few years is only set to intensify, as the combination of supply constraints, more electric cars, and a changing brand landscape mean the parc will soon look very different. With such a dramatic change in forecourt dynamics, sourcing, pricing and selling cars are going to require a blend of both instincts and insights to navigate the market ahead.”

For more information, visit the Auto Trader website.