The UK’s used car market carries on climbing back to its usual level. This is according to data originating from the Society of Motor Manufacturers and Traders. They revealed the first half of 2023 recorded 4.1% used transactions growth year-on-year. This is equal to 145,381 or more vehicles changing owner. As one of the top resources for car brokers, we want to have a closer look.
Sales of superminis, like the Vauxhall Corsa, Volkswagen Polo, and Ford Fiesta, were especially strong in the first half of the year. These compact, usually affordable cars made up 31.5% of all the second quarter’s second hand car sales. This was followed by lower medium/C-Segment cars like the BMW 1 Series and Volkswagen Golf.
Following recent years of increases in new electric vehicles (EVs) sales, there has been an increase in UK sales of used battery electric motors. Examples include the Tesla Model 3, Cupra Born, and Nissan Leaf. Saying this, they are still a small part of the market.
Increased second-hand battery EV sales
In Q2 2023 there was an 82% increase in used EV sales in the UK, totalling 30,645 units. This accounts for a 1.7% share of every used car sale, and was up from 1% in Q2 2022. Plug-in hybrid sales rose 11.4% to 18,437. Due to tumbling values of pre-owned EVs, they have become more affordable.
The SMMT said that the present market remains around 10% behind 2019 levels. A chief executive from the Society stated that it was good to see a recharged new car industry that supports demand for used cars. In particular, it is great that it’s aiding people in getting behind the wheel of an electric motor. Talk to us if you want to know more about the world of car brokers.
Matching the undoubted desire for pre-owned EVs will rely on preserving a buoyant new car market. Also, it will depend on the provision of reliable, accessible charging infrastructure that uses green, affordable energy. In turn, this will enable more individuals to drive EVs at a price point that works for them. It would aid the acceleration of environmental goals.
ULEZ
The sales director at Close Brothers Motor Finance also has comments on the topic. They believe the expansion of London’s Ultra Low Emission Zone (ULEZ) could aid in increasing car market recovery. Having other cities do similar schemes could also help.
Diesel cars produced after 2016 comply with ULEZ. It is the same for most petrol cars created after 2005. As consumers seek out more compliant motors, many will head to the used car market to save money on buying new cars.
However, high used car costs, driven by demand surpassing supply between 2020 and 2023, could lead to some buyers having to pick models older than they’d prefer.
Policy sales
Furthermore, the RAC Dealer Network had a report that there was a 67% increase in warranties sold on cars that are 10 to 20 years old since the pandemic.
During 2020, 6% of all policies sold via the 1,200 used car retailers were for models in this age range. Within the initial six months of 23 though, it was up to 10%. Likewise, the amount of claims in the group was up from 15% to 21% of the overall total.
Moreover, there has been a 34% increase in sold warranties for 5 to 10 year old cars over the same time frame. It rose from 34% to 46%. Comparably, claims have increased to 65% from 61%.
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