Used car buyers returned to the market in January with 69% of the respondents saying that physical footfall improved compared to the previous month, according to research carried out by CAP.
It said on-line activity was “even more encouraging”, with 75% of respondents reporting improved levels of activity.
“Four years of strong new registrations are expected to drive unprecedented volumes of used vehicles in 2016.
“In this market consumer demand will be the pivotal factor in supporting residual values over the coming months,” said Black Book editor Philip Nothard,
“Following a roller coaster of a year for retained margins, those citing an improvement rose to 24%, compared to 18% in 2015.
“Positively, those indicating they had squeezed had fallen from 49% in January 2015, to only 30% this year,” he added.
Nothard said it was unclear just how much stock was yet to hit dealers’ forecourts.
“As we enter the new year, stock availability typically experiences an increase. However, compared to the 53% in January last year, those indicating an improvement reduced to 29%, which raises the question of how much more stock is on the horizon still to arrive,” he said.
Key points
- Dealers indicating that the current trade values are reflective of the market rose from 42% January 2015 to 51% this month
- Consumer demand remained in line with January 2015, with 67% indicating an improvement and only 17% reporting that his had worsened
- Dealers showed concern around nearly new vehicles, with over half agreeing and two thirds reporting there are too many in the market, and that they are buying with caution
