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Used car dealers continue to increase retail sales

Used car retail sales again increased in July as dealers enticed even more customers onto the forecourt.

Continued strengthening in the UK’s used car market is revealed by the latest CAP Used Car Performance Index, a survey of the used car trade.

CAP surveys a regionally weighted and representative sample of franchise and independent used car dealers across the whole of the UK each month.

As well as a stronger market than in June, the latest survey reveals a year-on-year increase bringing improved retail sales compared with July 2003.

Feeding the research process behind CAP Black Book – the independent benchmark guide to current used car values – the CAP Used Car Performance Index provides a unique insight into the fortunes of Britain’s £32bn used car market.

While July’s index demonstrates an overall strong performance it also reveals ongoing regional variations in fortune, with clear winners and losers around the country.

The five best performing regions in July were Eastern England, the North East, North West, West Midlands, London and the South East. Having reported difficult trading conditions for much of the year, dealers in the North West are doing especially well with sales increases for the majority over the last two months. July saw 70% of dealers here beating their June totals and only 20% failing to maintain performance.

They were closely followed by dealers in London and the South East, where even fewer saw negative results in July. Here 60% moved ahead, while 25% maintained level sales. Daren Wiseman, managing editor of CAP Black Book, says: “One feature of the current used car market is that dealers have been driving prices down in the trade in order to price cars more attractively on the forecourt.

“Our research shows that this is paying off, with our measure of ‘showroom footfall’ - the number of potential customers visiting dealers - showing a marked increase in July. Further evidence of their success in converting many of these visitors into buyers is revealed by the fact that the vast majority of dealers are still actively buying cars for stock.”

Used car performance – regional highlights July 2004

  • Eastern: This region has been performing well for some time, with July bringing increased sales for 63 %, while 37 % saw a deterioration.
  • East Midlands: Dealers here saw a swing into negative results. While June brought an overall retail sales increase, only 30 % of dealers maintained or improved performance.
  • North East: Dealers here are going from strength to strength with another improvement in performance for more than half of those sampled.
  • Northern Ireland: With a majority of dealers recording a dip in used car sales there is no immediate cause for alarm following an exceptionally strong performance in June.
  • North West: There is plenty to celebrate here as dealers continue to increase retail sales, making it the most successful region in July.
  • Scotland: Dealers here moved into negative territory after several months of improving or stable retail sales. Only 20 % saw an increase while 60 % achieved fewer retail sales than in June.
  • South East % London: A steady increase in performance here over recent months has now led to the second best results nationally in July, with 60 % of dealers growing their retail sales.
  • South West: This region is experiencing a small ‘see saw’ effect, with small monthly variations in retail sales. July saw a slight worsening but, overall, dealers here are achieving more stability than in many other areas.
  • Wales: The Welsh appetite for used cars is seeing little variation in sales from month to month. July brought a slightly worse result than June but with no sign of any real downward trend.
  • West Midlands: The third best performing region nationally in July, thanks to 56 % of dealers increasing their retail used car sales and only 22 % registering a fall.
  • Yorkshire % Humberside: An improvement in performance here saw dealers remaining level with June, following a period of small monthly declines.
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