Used car prices only began to rise in the second half of January in the UK, as measured by CAP’s real-time value guide Black Book Live.
After a ‘slower than usual’ start to 2013, according to a statement by the vehicle valuation firm, values began to rise as stock volume appeared to be lower than for the time of year and dealers sought to acquire the best-quality vehicles, particularly three-year-old cars.
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In November, the Black Book Live service, itself launched in May, also predicted the used market would experience an awkward start to 2013.
Derren Martin, senior editor of Black Book Live, said dealers were "prepared to compete for the stock they can most easily turn into prime retail offerings".
He added some franchised dealers were reporting stronger sales and margins than in the second half of January 2012, indicating consumers would "pay for quality instead of simply buying on price alone".
Continental shift
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By GlobalDataDespite demand starting to increase in the used market, Martin warned long-term prospects for the market were threatened by carmakers which might flood the UK with new sales as other European markets flounder.
Martin concluded the European situation could both hinder and help the UK second-hand trade market: "The current relative strength of Sterling against the Euro also makes Britain a stronger prospect for maintaining profits on new cars.
"If supply of new cars is increased significantly, through large-scale rental deals or pre-registration, it will probably stem the increase in trade values at some point. But even if that happens, many dealers will welcome the availability of more prime retail stock and consumers will also benefit from increasingly competitive deals as more cars are managed into the market."
CAP spoke out in August 2012 against the practice of pre-registration, with consumer valuation editor Philip Nothard labelling it the industry’s "worst kept secret".
richard.brown@timetric.com
