Evidence that the UK car parc is getting
older, and that fewer newer used cars are entering the market, mean
some tricky decisions ahead for dealers faced with difficulties
concerning the availability and quality of used stock, according to
Tim Naylor of BCA.
Naylor was reacting to a recent report by
Professor Peter Cooke into the used car market that showed that
despite the market for used car growing by an extra 270,000 in 2010
compared to 2009, the average value slipped by £90 to £5,332.
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Retailers, says Naylor, must decide whether to
move to selling higher-mileage older vehicles, reducing their
profit from motor finance, or to compete for the diminishing pool
of lower-mileage vehicles which are likely to become much more
expensive.
Sellers too will have awkward remarketing
decisions to make, Naylor continued. Do they invest in pre-sale
preparation? And if so, at what level?
Naylor also highlighted the findings in the
Cooke report that indicated consumers’ next intended purchase was
leaning increasingly towards smaller petrol-driven cars. “This also
poses a problem,” he said, “because much of the stock entering the
used market for the first time will be diesel-powered, higher
specification vehicles from fleet and leasing sources that are
likely to be more expensive.”
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