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Used car market tightens

Average values of dealer part exchanges mirrored the general market trend in June with prices falling for the second consecutive month.

According to Manheim's latest market bulleting, overall volumes of part exchanges were down in June reflecting the tougher conditions on retail dealer forecourts.

Average part exchange prices were down by £75 or nearly 4% to £2,047, although average age (88 months) remained the same and mileage increased by less than 500 miles to 71,409.

Petrol models remained fairly constant, falling by just £49 in June 2007 to £1,839 with average age remaining static at 90 months and mileage increasing by nearly 700 to 68,633.

In contrast, diesel variants fell by an average of £180 to £3,144, on the back of a one month fall in average age to 77 months and a drop in mileage of around 600 miles.

The percentage of cost new price remained at 20%, caused due to a slight change in model mix, whereas the percentage of cost new price on petrol cars fell from 15% to14%.

Diesel compact executives remain the star of the dealer show returning 27% (£5,883) of their original cost new at an average of 64 months and 85,513 miles.

Superminis were the best performing petrol sector at 20% of their original cost new (£1,529), despite being 86 months old, with 58,484 miles on the clock. Petrol large family cars continue to be the poor relation realising just 9% (£1,374) of their original cost new at 92 months and 84,533 miles.

Rob Barr, Manheim’s group communications director, said: “It’s clear that the retail market is getting harder but this is in line with the seasonal trend at this time of year. We now expect trading conditions to remain at this level until the end of the holiday season.

“Petrol models still account for more than 80% of part exchanges coming to auction which means dealers are either hanging onto to their used diesels for retail stock or the ever growing volume of new diesel sales has yet to fully impact on the used dealer market.”

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