Used car retail prices outperforming seasonal trends

According to the latest data from Auto Trader, retail prices outperformed seasonal norms in August, boosted by strong underlying consumer demand in the used car market. And despite the country being gripped by Olympic fever for much of the month, it did little to dampen the appetite for used cars, with transactions rising around 3% year-on-year (YoY).

At an average of £16,316, prices decreased, albeit marginally by -0.1% on a month-on-month (MoM), and like-for-like basis, much ahead of the -0.8% drop recorded in August last year, and the -0.4% in 2019. In fact, ahead of the pandemic, and stretching back to 2011 when Auto Trader began tracking used car prices across the market, prices have typically softened circa -0.5% in August.

Prices are being affected by the favourable imbalance in supply and demand dynamics across the market. Indeed, in August the volume of used cars being advertised softened -5.3% YoY, which is the fifth consecutive month of contraction, and the steepest fall since July last year. Conversely, however, it’s being offset by very robust levels of consumer demand, which based on Auto Trader data increased 7.3% YoY in August; a notable rise on the 2.5% uplift recorded in July. 

This combination is not only helping to stabilise retail prices, but it’s also contributing to a healthy and profitable used car market. In fact, Auto Trader’s Market Health metric, which assesses the supply and demand dynamics in the market to determine underlying health, saw levels increase from 8.2% in July, to 13.3% YoY.

Robust consumer demand is also reflected in the circa 82 million visits to Auto Trader last month, which is 6% more than the same period last year, and a huge 20% on August 2022. It’s also evident in the current pace in which used cars are currently leaving retailers’ forecourts. Last month, it took an average of just 28 days for a used car to sell, which is one day faster than in July and a whole three days faster than in August last year.

Market dynamics fuelling nuance

A look under the bonnet reveals that these market dynamics are also playing out at a more granular level, and to a far greater degree. Consumer demand for used petrol cars rose 7.4% in August, whilst levels of supply contracted at a similar rate (-7.4%); this favourable imbalance is evident in the very robust 15.9% rise in Market Health for these cars, and their average price of £14,681. In contrast, demand for used electric vehicles (EV) rocketed a comparatively whopping 49% YoY. However, due to an equally large rise in levels of supply, up 45.3% on August last year, Market Health rose a relatively conservative 2.3%, whilst overall EV prices (£26,736) softened slightly, by -0.3% MoM.

An even more granular view of the data, however, reveals that 3-5-year-old electric cars are performing exceptionally well. In August consumer interest for these ‘middle-aged’ battery powered cars rose 132.3% YoY. And although supply surged 157% over the same period, the huge levels of demand have helped lift average prices (£18,846) up 0.1% MoM, marking the first rise among this segment of the maturing electric market in over two years. What’s more, they took an average of just 22 days to sell in August, faster than any other market segment, and by some margin.

Commenting, Richard Walker, Auto Trader’s Data & Insights Director, said: “We’re well into the second half of the year now, and it’s very reassuring to see the used car market continue to maintain its momentum. Despite potential distractions over the last few months, not least the Olympics and the Euros, we’ve not seen any impact on consumer appetite for used cars; demand remains robust, and cars are selling at pace, and so our outlook for the closing months of 2024 remains very positive. As ever the market is incredibly nuanced, and so whilst at a high level it’s performing well, a deep dive into the data really does reveal some very strong pockets of profit potential. I’d urge retailers therefore to use the tools and insights available to discover these gems for your forecourts.”

Sue Robinson, Chief Executive of the National Franchised Dealers Association (NFDA), added: “As summer draws to a close, the underlying health of the used car market continues to show positive signs with robust consumer demand and used cars selling faster than when compared to August last year. Notably, this was despite a reduction in the number of used cars available for sale. Retail prices also appear to be stabilising, which supports a healthy and profitable market.”

Top 10 used car price growth (all fuel types) | August 2024 vs August 2023 like-for-like

Ranks	Make		Model	Aug 24 Average Asking Price	Price Change (YoY)	Price Change (MoM)
1	Porsche		Cayman	£31,762	2.3%	2.3%
2	Suzuki		Jimny	£11,511	1.3%	3.1%
3	BMW		M5	£41,245	1.3%	0.0%
4	Kia		Picanto	£8,671	-0.2%	0.5%
5	Alfa Romeo		Giulia	£26,328	-0.4%	2.5%
6	Hyundai		i10	£7,976	-0.5%	-0.4%
7	Volkswagen		up!	£7,988	-1.3%	-0.3%
8	Aston Martin		Vantage	£67,548	-1.4%	-0.2%
9	Audi		R8	£71,673	-1.4%	0.8%
10	Volkswagen		Beetle	£7,564	-1.6%	0.1%

Top 10 used car price contraction (all fuel types) | Aug 2024 vs Aug 2023 like-for-like

Rank	Make		Model	July 24 Average Asking Price	Price Change (YoY)	Price Change (MoM)
10	Hyundai		ix35	£5,189	-21.7%	-1.9%
9	Nissan		Leaf	£11,890	-22.5%	-1.3%
8	DS AUTOMOBILES		DS 3	£7,042	-22.6%	-0.2%
7	Fiat		500L	£5,624	-22.8%	-0.1%
6	Tesla		Model 3	£22,766	-23.2%	-0.4%
5	Audi		e-tron	£25,937	-23.4%	-0.5%
4	Nissan		Pulsar	£6,545	-23.7%	-4.1%
3	Vauxhall		Corsa-e	£14,703	-23.8%	-0.3%
2	Citroen		e-C4	£16,761	-24.0%	0.6%
1	Vauxhall		Zafira Tourer	£6,716	-24.5%	-1.4%