New car registrations | October 22
October saw a big jump in registration volumes when compared to pre-pandemic levels, a welcome sign of a market that is finally seeing positive supply movement, progress surely welcomed by consumers who placed their orders a good while ago and are only now taking delivery
"Significant growth in registrations is a step in the right direction, and it’s tempting to interpret this as a step-change moment for the broader health of the market. However, a quick look under the bonnet shows that we are still a long way off reaching pre-pandemic supply levels, with only modest improvements in stock available for immediate sale and lead times for factory orders often still at record levels, implying that this movement is only an early step towards something resembling equilibrium than anything else.
“As the broader cost of living crisis impacts consumer buying behaviour, demand for cars has begun to flatten and we’re seeing an increasing number of consumers turn to finance as a more palatable financial route into personal mobility. Finance searches have never been so high on Auto Trader with search volume up 43% on pre-pandemic levels and up 8% compared with the highs of 2021, showing that many people are looking to spread the cost as budgets are tightened. Currently, we’re seeing that finance rates for new cars are climbing much faster than used cars.
“We’ll be monitoring how this trend towards finance will fare in the face of the Bank of England interest rate hike announced this week. It’s worth flagging that consumers already in finance agreements won’t see any increases until the end of their contract so will be shielded, at least for now, from the immediate effects of these rises.”
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