Car dealers’ used vehicle stock levels have declined by 30% as post-lockdown demand among buyers leaves businesses “grappling” with the challenge of securing fresh product for their forecourts.
New market data published by eBay Motors Group shows that the average used car dealer saw their stock reduce to 47 vehicles in July as enquiries from potential customers soared by 153% year-on-year.
The eBay Motors Group’s latest Market View reported that stock levels at the average used car supermarket had dropped 52% year-on-year last month, from 516 to 247 units.
Franchised dealer sites saw stocks drop by 13 vehicles to 54, while independents saw a more modest drop of just five units to 44.
Unlike used car pricing data already published by Cap HPI and Auto Trader – both of which indicated rising values among reduced supplies – the marketing platform said that values had declined marginally, by 0.6% to £12,791 last month, however.
Dermot Kelleher, head of marketing and research at eBay Motors Group, said: “Our July Market View analysis shows a sector grappling with the challenge of meeting high customer demand with depleted stocks.
“With auction and remarketing companies reporting high numbers of trade buyers going online to source stock, some dealers are going outside of their comfort zones and working hard to replenish forecourts.
“The coming weeks will be crucial for dealers looking to bounce back by satisfying the pent-up demand shown by the high volume of enquiries their online activities are generating.”
After the Society of Motor Manufacturers and Traders (SMMT) detailed an 11.3% rise in July new car registrations yesterday (August 5), National Franchised Dealers Association director, Sue Robinson, suggested that used cars could prove the retailers’ key area of opportunity during August.
Cap HPI’s UK head of valuations, Derren Martin is expected a potential “market correction” in September, however, with demand faltering alongside values as COVID-19’s impact on the economy triggers redundancies and increased caution among consumers.
Martin said that he also foresaw a rise in vehicle supply as remarketing providers ramp-up their operations and new car sales begin to result in increased part-exchanges.
Increased stock could be good news for retailers who are currently struggling to replenish depleted stock levels amid strong consumer demand, according to eBay Motors.
It reported that buyer enquires made by phone calls and emails in July were up 24% on pre-lockdown levels recorded at the beginning of March and 153% higher than the lowest point of the lockdown.
With high numbers of buyers chasing fewer available cars, average days in stock improved month-on-month from 73 to 66 days, although still significantly above the 41 days averaged in July 2019.
Petrol remained the fuel of choice for used car buyers, accounting for 54% of all searches and 52% of dealer stock, the same level as last year.
Interest in diesel remained high with 44% of views, marginally down from 45% last year, accounting for 45% of stocks, compared with 46% last year.
Diesel cars matched petrol cars in the time they spent on the forecourt, both averaging 65 days.
The fastest selling used car in July was the Vauxhall Astra GTC (40.4 days), followed by the Audi S3 (40.5 days) and Mercedes-Benz SLC (41 days).