Used car prices have remained strong even though demand for second-hand vehicles is gradually slowing down.
According to data from Auto Trader’s Retail Price Index, the average price of a used vehicle has grown 28.4 per cent over the last year, marking the 26th consecutive month of growth.
But despite the increase, demand is gradually slowing down following the impact of inflationary pressures on consumers.
Advert views on Auto Trader have gone down 12.6 per cent on 2021 levels but onsite activity remains 12.4 per cent higher compared with 2019.
“It is important not to jump to rash conclusions about the health of the market, despite the softening in used car price growth during May,” said Auto Trader’s director of data and insights Richard Walker.
“This is obviously a tough time for consumers and there are further economic hardships to come.
“But the supply chain issues triggered by Covid and its aftermath mean that there are around two million fewer cars in the market than would have typically been the case – and the problem has been worsened by the crisis in Ukraine.
“This is a market which is only going to gradually return to normal.”
The results came a day after online car retailer Cazoo announced it was forced to cut 750 jobs because of macroeconomic pressures.
Under its business realignment plan, the company will axe 750 UK and EU positions, cutting vehicle preparation as well as customer support sites.
The UK automotive output fell to a historic low, after 124,000 new cars were registered in May, City A.M. reported.