Used car price growth has accelerated significantly, according to Auto Trader, following the reopening of showrooms last month.
Based on the circa 440,000 used vehicles currently advertised on its marketplace, the average price of a used car increased by 6.8% year-on-year on a like-for-like basis last week.
It not only marks 53 weeks of consecutive price growth, but a sizable increase on the 5.7% YoY recorded during the week of April 12, following which growth levels have increased consistently week-on-week.
Increased consumer demand is highlighted by the average number of daily cross platform visits on Auto Trader. Last week the figure was 2.4 million, an increase of 41% on the same period in 2019.
As a result of this increased activity on site, the average number of leads being sent to retailers surged 99% on the same period in 2019.
Auto Trader’s director of data and insight, Richard Walker, said: “The levels of demand that we’ve been tracking this year have been incredibly strong, but the reopening of physical forecourts last month provided a substantial boost to demand and to used car prices.
"Such is the strength of the market, we’ve noticed that not only are retailers making significantly smaller price reductions to their stock than normal, but we’ve seen a dramatic acceleration in the number of those actually increasing their prices. And whilst we’re hearing nervousness around the current trade price inflation, I hope our data reassures retailers of both the consumer demand and the profitable margins available when applying a retail back approach to their pricing and sourcing strategy.”
The price growth has also been affected by ongoing supply challenges in the market. According to the Auto Trader Market Insight tool, supply was down by 10.3% last week when compared to 2019.
An average of 2,290 retailers made daily price adjustments, which is 400 fewer than the same period in 2019. Also, an average of 12,604 vehicles were repriced every day last week - which is 27% fewer compared to 2019. The data also suggests retailers were making significantly smaller reductions to sticker prices, averaging at just -£24, which is 93% less than the average adjustment made in 2019 (-£321).