The volume of cars passing through UK remarketing centres looks set to stabilise during March following a “few months of strong growth”, according to NAMA.
The National Association of Motor Auctions (NAMA) said that a shortage of quality used cars would see auction activity reduced as retailers kept hold of an increased number of part-exchange vehicles for retail in what is normally a bouyant month for the remarketing sector.
NAMA made the obeservation as it revealed details of responses to its monthly market attitude survey.
“Following the past few months of strong volume growth, respondents to the survey are expecting volumes to stabilise during March,” said Louise Wallis, the head of NAMA, in response to the latest figures from NAMA’s market attitude survey.
“The market is expected to remain strong in the run up to Easter, although external factors may have some short-term effects on the market, particularly the uncertainty surrounding coronavirus.
“That said, any impact is likely to be short lived and only delay vehicle buying decisions rather than remove them altogether.”
A total of 38% of respondents to NAM’s monthly survey said that they believe used car volumes will stay the same this month, with a quarter estimating an increase, with 42% expecting a fall.
NAMA said a limited supply of good quality used cars would mean that dealers are holding onto more part-exchange vehicles to sell at retail rather than auctions.
Conversion rates are predicted to remain strong, with 58% of respondents expecting yet another rise, a third believing they will stay the same, and only 8% think they will decrease.
First time conversion rates also saw 58% of respondents expecting an increase, as demand for good quality used car stock continues amid strong consumer sales.
NAMA said in a statement: “Following a strong two months for vehicle values, they are generally expected to plateau in March by NAMA members.
“83% of respondents suggest that petrol cars will remain the same, with 75% saying the same for diesel, and 82% for hybrids.
“No respondents believe that petrol, hybrid or plug-in hybrid values will decrease, and only 17% believe diesel value will decrease.”
Earlier this week AM reported in Indicata data that showed UK car buyers have Europe’s strongest appetite for used diesel cars.
The used car inventory and pricing software specialist found that retailers in the UK sold their stock of diesel vehicles faster than any other market in the continent’s top-five largest markets (plus Belgium) during 2019, with an average days to sell (ADTS) low for diesels of just 48 days in both April and October.