The rising cost of living is predicted to directly impact the automotive sector, with most 2023 forecasts being downgraded due to potential supply challenges.
Despite the headwinds, Cox Automotive’s market tracker for September 2022 states that the wholesale demand remains reassuring.
In September 2022, car registrations in the UK touched the 225,300 mark, which represents an increase of 4.6% year-on-year (YoY) basis.
However, the figures are still 34.4% below pre-pandemic figures from 2019.
While the sales for private vehicles have declined by 3.6% on a YoY basis, fleet sales were up 12.5% and business purchases recorded a 70.5% jump during the same period.
Cox Automotive insight and strategy director Philip Nothard said: “This further decline in new registrations in September has proved unsurprising, considering the Gfk consumer confidence index tumbled to a new low of -49, as households grapple with surging CPI inflation and more expensive car finance costs.”
European new car markets also recorded YoY growth in September but they remained below pre-pandemic levels.
Germany recorded an improvement of 14.1% YoY but was below 8.1% in comparison with 2019 figures, France was up by 5.4% and 18.6% lower than in 2019.
Italy rose by 5.5% YoY and remained 22.2% lower than in 2019, and Spain recorded a rise of 12.7% YoY but remained 17.8% behind 2019 levels.
In the wholesale market, September was a busy month for conversions and price performance. Cap clean performance reached 98.19%, a 1.94 rise on 2019 levels. First-time conversions were at 86.6% for September.
According to Cox Automotive, Manheim’s full hybrid auction sale programme has helped to boost numbers for the month. Nothard added: “Dealerships are advised to remain cautious, as they have been throughout 2022. Unfortunately, consumer spending power has not yet been restored and will likely be negatively impacted as we move into the winter months. However, the used market offers a flicker of hope with neither prices nor demand likely to drop, whilst lack of supply remains.”