Retail Price Index | March 2022
USED CAR PRICES CONTINUE YEAR-ON-YEAR GROWTH, BUT THE TRAJECTORY SHOWS SIGNS OF SLOWING
The latest findings from the Auto Trader Retail Price Index, which is based on daily pricing analysis of circa 900,000 vehicles, revealed that the average price of a used car increased 32% on a year-on-year (YoY) and like-for-like basis in March. It marks the 24th month of consecutive YoY price growth; over this period motorists will have seen the average value of their used car increase nearly £4,400.
Whilst YoY prices are continuing to increase, it’s clear that the rate of growth is beginning to ease, with March’s 0.1% rise on the 31.9% recorded in February representing the lowest monthly movement since November 2020.
Although there are signs of a slight softening in demand, influenced in part by the rising cost of living, comparisons with last year are distorted by the strong on-site demand recorded in March 2021 as buyers edged towards the end of lockdown. However, despite potential economic headwinds, there continues to be plenty of consumer appetite in the market, which is evident in the fact that demand is up against pre-pandemic levels (circa 4% on March 2019) and traffic to the Auto Trader marketplace remains very strong with circa 69 million cross platform visits in March.
Further highlighting the current resilience of the used car market, the latest on-site research conducted by Auto Trader suggests consumer confidence remains robust. Around 40% of the circa 1,600 people surveyed in March intend to buy in the next two weeks, and 67% want to buy in the next three months.
Although used car price growth and consumer demand is softening, it’s important to put it into context. Against a backdrop of ‘once in a lifetime’ levels of demand in 2021, it’s easy to misinterpret the data as a market in decline, but a quick look under the bonnet reveals that any suggestion prices are about to tumble, is unfounded. Despite growing economic pressures, the appetite for new and used cars remains above pre-pandemic levels, which combined with the ongoing squeeze in supply, will keep used car prices strong for the foreseeable future.”
One in five ‘nearly new’ cars priced above brand new equivalents
Looking at the data on a more granular basis, one in five (20%) of the nearly new cars currently available (those aged up to 12 months) are more expensive than their brand-new equivalents. Over the last 12 months, the average price of these nearly new cars has increased circa £8,700[1], and over £11,700 in the last two years[2]. Remarkably, despite these unprecedented pricing dynamics nearly new cars were selling on average 22 days faster last month than in March 2021 (30 days vs 52).
Growing pinch at the pump sees EV demand rocket
It’s evident the current record fuel prices is influencing the market dynamics of electric vehicle (EV) and internal combustion engine (ICE) vehicles. On Auto Trader, demand (based on searches and advert views) for EVs has gradually been easing since the original fuel crisis in autumn of 2021. However, as prices at the pumps have accelerated over recent weeks, there’s been a notable reversal of this trend, with levels of demand for [3]premium and volume[4] brand EVs increasing 79.1% YoY (up significantly on the 28.8% YoY growth recorded in February) and 120.2% YoY (up from 53% YoY) respectively. Although EV supply is growing, these external factors are stimulating demand at a much steeper rate, helping to fuel very strong price growth for both premium (20.1% YoY / £50,499) and volume (27.5% / £26,137) brand EVs.
These factors have also contributed to a further easing in appetite for their ICE counterparts, with demand for used petrol cars back -10.3% on March 21 (down from -4.7% YoY in February), and diesel dropping from an already low -13.6% YoY in February, to -21.3% last month. However, due to the ongoing supply constraints of ICE vehicles (down -2.4% YoY and -10.3% respectively), both used petrol and diesel cars recorded strong price growth last month, increasing 33.9% YoY (£16,593) and 31.1% (£17,641) respectively.
Prices for three-five-year-old cars continue to rocket
Year-on-year prices were up across all age cohorts in March, with three to five-year-old cars recording the largest price movements in recent months, rocketing a massive 35.8% YoY (£20,445). It was followed by cars aged five to ten years old, which saw prices increase 32.3% YoY (£13,212).
Sue Robinson, Chief Executive, NFDA, added: “Used car prices remain at high levels despite seeing a level of stabilisation. Considering the impact that external factors such as the rising cost of living are having on consumer confidence and taking into account ongoing supply constraints, the latest data shows that underlying demand for second-hand vehicles remains robust. It is encouraging to see that appetite for both new and used electrified vehicles continues to be particularly strong.”
Top 10 price growth (all fuel types) | March 2022 vs March 2021 like-for-like
Such is the strength of the used car market, just two of the lowest performing models have seen prices contract.
|
Ranks |
Make |
Model |
Mar-22 Average Asking Price |
Price Change (YoY) |
|
|
1 |
SEAT |
Alhambra |
£18,895 |
58.1% |
|
|
2 |
Ford |
S-Max |
£15,471 |
54.8% |
|
|
3 |
Toyota |
Auris |
£13,063 |
51.6% |
|
|
4 |
Renault |
Scenic |
£8,162 |
51.4% |
|
|
5 |
SKODA |
Yeti |
£12,955 |
51.0% |
|
|
6 |
Hyundai |
i30 |
£12,468 |
50.6% |
|
|
7 |
SKODA |
Octavia |
£16,468 |
50.0% |
|
|
8 |
Citroen |
Berlingo |
£13,167 |
49.9% |
|
|
9 |
Ford |
Galaxy |
£16,247 |
49.5% |
|
|
10 |
Ford |
Grand C-Max |
£12,536 |
49.4% |
|
Top 10 price contraction (all fuel types) | March 2022 vs March 2021 like-for-like
|
Rank |
Make |
Model |
Mar-22 Average Asking Price |
Price Change |
|
|
10 |
Mazda |
CX-30 |
£24,621 |
5.1% |
|
|
9 |
DS AUTOMOBILES |
DS 3 CROSSBACK |
£21,784 |
5.0% |
|
|
8 |
Tesla |
Model 3 |
£47,705 |
4.0% |
|
|
7 |
Vauxhall |
Crossland |
£19,708 |
3.4% |
|
|
6 |
Land Rover |
Discovery 3 |
£8,363 |
2.5% |
|
|
5 |
BMW |
8 Series Gran Coupe |
£60,799 |
2.0% |
|
|
4 |
CUPRA |
Formentor |
£35,747 |
0.8% |
|
|
3 |
BMW |
8 Series |
£56,886 |
0.2% |
|
|
2 |
Porsche |
Taycan |
£120,565 |
-1.2% |
|
|
1 |
Vauxhall |
Mokka |
£12,046 |
-4.9% |
|
[1] £27,558 in March 2020 vs £36,228 in March 2022
[2] £24,518 in March 2020 vs £36,228 in March 2022
[3] Premium EV brands categorised as: Audi, BMW, Mercedes-Benz, Land Rover, Jaguar, Tesla, Volvo, MINI, DS AUTOMOBILES, Lexus, Abarth, Alfa Romeo
[4] Volume EV brands categorised as: Ford, Volkswagen, Vauxhall, Peugeot, Nissan, Citroen, Kia, Hyundai, MG, Renault, SEAT, SKODA, Honda, Toyota, Fiat, Suzuki, Mazda, Mitsubishi, Smart, Dacia, Jeep, Subaru
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