An unexpectedly strong December left used car retailers expressing disappointment with their sales performance going into 2005.

This is the main finding of the latest CAP Used Car Performance Index – a monthly survey of retail used car sales based on a nationwide sample of dealers, weighted by region.

The closing weeks of 2004 saw dealer expectations of a poor December overturned by an unusually busy Christmas month.

In contrast, dealers reported the start of the year as slower than anticipated. January saw retail sales little changed across the board, along with a generally downbeat dealer sentiment.

The best start to the year was enjoyed by dealers in the south west. This region has been surging ahead in recent months, compared with other areas of the UK. However, in comparison with their performance in December, dealers overall managed only a 'slightly better' sales result in the early weeks of 2005.

Running a close second was Wales, where dealers started the year with significantly improved sales results in comparison with the winter months of 2004. However, Welsh dealers are the least confident of maintaining or achieving an increase in their retail sales performance in the coming weeks.

One Cardiff dealer said: "The market is completely unreliable now so when you have a good week it rarely carries on and you never feel comfortable that business is back on track. Customers are harder to pin down than ever so that even if there are plenty of enquiries it doesn't mean they will buy – it's as likely they will just go elsewhere to play you off against another dealer."

Of the English regions, worst performer was the West Midlands.

Dealers here have enjoyed consistent growth over the last 12 months, but January proved disappointing. However, they generally expect to see further growth in the coming weeks, turning in the second highest confidence rating in England, just behind the North West.

A dealer in Birmingham said: "We've had a good trading period for the past year but it's been down to hard work rather than an easy market. Getting customers in is not a problem but closing deals is harder than it's ever been. The key is working out which models will move the quickest and we've significantly changed our stock profile since we started looking more closely at this."

Used car retail sales performance – regional highlights January 2005

Eastern: This was the second best performing English region in the January survey but even here sales failed to reach a 'better' ranking, leaving Eastern dealers with an overall similar sales performance rating compared with December.

East Midlands: An unremarkable month in terms of sales success saw dealers here enjoy only slight growth compared with December. In terms of confidence for the weeks ahead they generally expect to maintain similar sales results.

North East: A mixed result was recorded for dealers in the North East. Overall they managed to grow sales slightly but in terms of confidence they do not currently expect to achieve more than stability in the immediate future.

Northern Ireland: Typical of the UK used car market as a whole, the experience in Northern Ireland was of maintaining similar levels of retail business compared with December 2004. They do, however, return the highest confidence rating in the country with a general expectation of immediate future growth.

North West: With a patchy year behind them, dealers here seem determined not to lose ground. While January's retail sales saw little change on December they lead the rest of England in terms of confidence for the weeks ahead. But even here, they do not expect significant immediate growth.

Scotland: Dealers in Scotland enjoyed an overall slightly better performance than the UK average, but only managed to score a similar rating in terms of January sales compared with December. They also expressed one of the least optimistic forward views in the latest survey.

South East & London: The retail sales strength of dealers in the capitol and surrounding area was proved last year by bucking the winter trend and maintaining growth. January saw them roughly in line with the rest of the country both in terms of performance and confidence.

South West: This was another strongly performing region during the closing months of 2004 and this achievement has continued with the best results in Britain for January. However, in terms of dealer sentiment, the top performing region's expectations are limited to stability, rather than continued growth, for the coming weeks.

Wales: The second best UK performer at the start of 2005 – apparently ending a long period of slow winter trading. Wales was the only other region, after the South West, to achieve sales growth in January. However, Welsh dealers returned the lowest confidence rating in the country, looking forward.

West Midlands: Outperforming the rest of the country for a time last year, dealers here could only manage to maintain similar sales levels in January. However, they do remain more confident that sales will not diminish than their counterparts in most other regions.

Yorkshire & Humberside: Dealers here had an unremarkable start to the year, achieving similar sales levels to those in December. In terms of confidence they are generally of the view that little will change in the coming weeks.