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Used car sales drop 400,000 as traders feel supply tightening

Electric cars continued to buck the trend, with used electric vehicle sales jumping 57%, but the rest of the market struggled, falling 18.8% year-on-year last.

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The latest figures from the Society of Motor Manufacturers and Traders (SMMT) show sales in April, May and June fell by nearly half a million from 2021 to 1,759,684 in 2022.

Problems in the new car market have reduced the supply of the second-hand trade

The market has seen a strong upturn in activity in 2021 with the full reopening of dealerships, but pressures on supply and on driver spending appear to have stalled this rise. Sales are down more than 8% compared to the same period last year and 13.5% compared to 2019 before the pandemic.

SMMT chief executive Mike Hawes said the decline was inevitable after the strong performance in 2021 and in the face of problems in the new car market.

He said: “It was inevitable that the squeeze in new car supply would trickle down to the second-hand market. Despite this, UK used car buyers clearly have a growing appetite for the latest low and zero emission cars, and we need a thriving new car market to fuel it. The next Prime Minister must create the conditions to boost consumer confidence, especially in electric vehicles, to drive the fleet renewal needed to meet our decarbonisation goals.

Like new car sales, used EV sales continue to grow but still only represent 1% of the used market.

James Fairclough, CEO of used car market AA Cars, said the latest figures suggested demand was falling but could rebound as motorists look to save money.

He commented: “It’s worth remembering that the disappointing overall figure had a lot to do with it – it’s a comparison to the strong sales recorded in the second quarter of 2021, when dealerships reopened after months of lockdown.”

He said new car supply issues had helped drive motorists into the second-hand market, but that increase was ‘running out of steam’, adding: ‘Although supply issues As the new car market is finally starting to subside, another factor could boost the market opportunity in the coming months – the rapidly slowing UK economy.

“While the darkening economic situation has undermined consumer confidence and eroded the willingness of some people to buy big-ticket items like cars, there will still be a significant number of drivers who want or need to replace a aging car.

“For them, the second-hand market – which offers both a great choice and better value for money than new cars – is a very attractive option, and even more so now that more and more electric vehicles are appearing. on the second-hand market.

Lisa Watson, sales director at Close Brothers Motor Finance, said financial concerns were also causing the market to slow. She said: “Well-documented supply chain issues, such as shortages of semiconductors, have continued to drive people into the used car market. However, the fact that people are keeping their cars longer has caused a slowdown in transactions in recent months.

“Despite supply pressures, demand for used vehicles remains strong – consumers are turning to the used market to soften the blow of the cost of living crisis and avoid car delivery delays new, which sometimes exceed 12 hours.