Pressure is mounting on used car margins as dealers contend with higher refurbishment costs for vehicles. Black Book Live Senior Editor, Derren Martin, said older, higher mileage cars will form a significant proportion of cars available as the summer progresses. He warned that pressure is likely to grow on late-plate cars during June and July, with a knock-on effect for some older vehicle values.
“When the pre-registered cars from March find their way back into the used car market they are likely to be priced as attractively as possible by dealers to ensure they do not end up with overaged stock. “This sometimes means they reappear in the market at lower prices than slightly older equivalents. Taking into account low deposit offers and other incentives this unnatural dynamic inevitably affects older values if the situation is sustained,”
“Continued downward pricing movements are likely across the board, with volumes in the market not likely to decline any time soon. “However, these downward movements are only likely to be in-line with the movements over the last two months and are nothing untoward or unexpected,” he added.
