The number of nearly-new cars in the retail market has nearly doubled in the last six months, indicating a rise in pre-registrations warns Glass’s.
The firm used its Glass’s Radar sales tracking tool to monitor the number of sub-one year old cars sold in the UK during March and found it was 91% higher than six months ago.
“While you would generally see an increase in sales of this type between October and March, this is much higher than we would expect,” said Rupert Pontin, head of valuations, said:
“While some of these are early PCP returns, the unavoidable conclusion, based on what we are seeing in the market, is that the vast majority of these are pre-registrations.
“It is no secret that most manufacturers have set some very ambitious new car sales targets for this year and, while the market remains strong, there is simply not enough demand to make them attainable in many cases. Hence the number of pre-regs that we are seeing.”
Pontin warned the affordability of new cars on PCPs was impacting sales of nearly-new models.
“The conversion rate at manufacturer and closed auctions for late-plate cars is falling quite noticeably. Demand for almost any model at less than two years old is weakening by the day.”
Pontin warned the situation was unlikely to re-balance in the short-medium term as pressure to continue to pre-register would continue.
“The new car sales targets that have been set are high throughout the whole of 2015 and, unless demand increases, which seems unlikely, the only way to meet them will be to continue to pre-register.
“The likelihood is that pressures on values of this kind of car will remain for some time to come. Only if and when more realistic targets are set by manufacturers will the situation change.”
