Used car supply in flux

27 September 2012  

THE SUPPLY of used cars is currently ‘tight’ according to one panel of experts, but the situation is set to ease soon according to another.

As a result of the current shortage, trade auction values are likely to remain high through to the year end with buyers having to pay more to secure the right stock for customers, according to Roger Woodward of online trade sales firm, CD Auction Group.

“The market is still tight so condition and specification remain critical,” Woodward says.

“We know some fleet operators are tempted to extend contracts and that is adding to the supply issues. In fact, they might be better off letting the cars go now and taking advantage of the strong demand and firm values.”

However, an industry analyst at car finance firm TFC suggests that a modest income rise amoung middle income buyers might bring them to trade in their existing vehicle in the New Year. According to the firm this should coincide with a wave of ex-fleet trade-ins that will ease the stock flow. “It is precisely these groups which have been holding onto their cars for longer, rather than committing to more finance in uncertain times,” said Richard Cox, TFC’s head of motor operations.

“Whilst the predicted income rise isn’t huge, it may well be enough to boost consumer confidence and drive more prospective buyers onto the car forecourts.”