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Nearly new volumes force ‘price erosion’ says Cap HPI

James Dower, Cap HPI

Nearly new volumes “are of significant concern”, says Cap HPI, and likely to cause downward pressure on prices.

James Dower (pictured), senior editor black book at Cap HPI, said: “The stock volumes that were expected in October did not enter the used car arena until a little later than would normally expect. 

“This led to values holding a little stronger than the seasonal average.

“The overall downward movement at three years 60,000 miles was 1.3% which is well within the seasonal average of 2.0%.

“Nearly new volumes are of significant concern and are very likely to cause price erosion to those manufacturers that have had to force registrations on the derivatives that they have chosen to register in volume.”

Used values for nearly new city car are under pressure with values dropping faster than the industry average in October.

City car values dropped 2.5% at six months and 5,000 miles against an overall downward movement at three years, 60,000 miles of 1.3%.

Sub 12-month-old cars also came under pressure with up to 12-month cars reducing in value by an average of 1.5%.

The data, from vehicle experts Cap HPI, reports a strong October for values overall, due to the short supply of stock in the first half the month.

Market 'slips away'

However, downward movements were seen in the closing eight working days as the market slipped away at a far higher rate.

Convertible and coupe cabriolet saw the usual seasonal declines with a downward movement of 4.2% and 3.9% at three years 60,000 miles.

“The used car market is beginning to slow against a backdrop of increased dealer stock volume, high pre-registration levels and growing de-fleet numbers.

“Consumer confidence remains strong and proactive dealers will continue to find customers that are keen to buy.

“However, with the volume of stock that we have seen enter the market, price positioning in the used car marketplace will be essential and the use of real-time data, through products like Black Book Live, is recommended.”

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