Are there good times ahead?

Welcome to the latest edition of The Carfisher!

August Car Values

Yesterday marked the final day of August, and ended the month that saw the biggest drop in used car values for 13 years!

Used car values had fallen by two percent last month, making it the worst August in 13 years - but there’s no sign of a price crash yet.

Sluggish demand and better levels of supply saw used cars in the trade decline on average by £400, or two percent, in August said Cap HPI’s Director of Valuations, Derren Martin.

Speaking exclusively to Car Dealer Magazine earlier last month, Martin explained August was the fifth consecutive month of falling values this year.

Margins are being squeezed and customers are away on holiday so the demand isn’t there. On that note, if you ARE in the market for a new car then now might be the best time to negotiate a good deal.

UK new car production has risen

Car production in the UK rose again last month, marking seven months of consecutive growth.

The trade body, Society of Motor Manufacturers and Traders (SMMT), said UK carmakers continued to show signs of recovering from the global shortage of chips, but did say that current output still remained 29.4 per cent lower than pre-pandemic August 2019.

The latest independent production outlook, suggests that total UK car production will reach around 860,000 units this year, an increase of 10.9 per cent on 2022, with the possibility to get production back to the million mark in 2028.

Cost-of-living crisis means used car buyers are turning to older models to save money!

This is something I’ve seen myself over the last three to four months, but now is being backed up by data from the big boys!

Data collected by eBay Motors Group found that used car buyers are tightening their purse strings and favouring older vehicles in response to the cost-of-living crisis, and found that four in five online searches for cars in August have been for models that are five-years-old or more.

The firm’s analysis revealed that older cars have made up 81 per cent of searches on its Motors.co.uk platform last month.

Responding to the findings, Lucy Tugby, marketing director of eBay Motors Group, said: “Consumer demand was flat in August as buyers’ attentions and budgets had switched to summer holidays. However, for those buyers needing a car out of necessity, the focus was on older age profiles, demonstrating how the cost of living crisis is continuing to impact affordability.”

All eyes are now on how much of an impact the September plate-change will have on the retail sector and whether private buyers can be enticed back in to the showrooms.

Used car sellers finding selling their car more stressful than organising a family holiday, moving home, and some even say more stressful than planning a wedding!

You’ve all heard of the online used car dealer Cazoo, right? I’ve got my own thoughts about the self proclaimed disrupters in the market, which I will touch on in future editions, but they recently surveyed 2,000 used car owners and the results they found have encouraged me to continue to make selling a used car as stress free as possible!

A survey of 2,000 used car owners found many rate a large variety of notoriously stressful activities as easier to deal with than a car sale.

Respondents said moving house, taking an exam, planning a wedding and doing a tax return were all preferable to deal with than selling a used car.

Overall, 51 per cent of respondents said they found selling their car ‘tough’, and 18 per cent said they thought it was ‘stressful’.

The research was carried out by online used car dealer Cazoo and published on its website. The firm has faced a turbulent 12 months, closing handover centres, preparation sites and cutting hundreds of jobs.

So, there we have our August mini round up. It’s seemed on the whole quite a bleak August, with the cost of living crisis affecting the market and the way customers are looking at new cars. Interest rates haven’t helped either, increasing demand in older cars. There has been some glimmer of hope though! The new car production seems to have started heading in the right direction.

Let’s see what September brings!