Top Three Motor Trade Stories from February
The three most important Motor Trade stories from February.
Below we have picked out three significant stories for the Motor Trade from February:
Used Car Market Strengthens
Used car values continued to strengthen in February. According to cap hpi Black Book, the value of cars aged three years with 60,000 miles on the clock rose by 0.5% in the first 10 days of February, it’s an improvement on the 2017 figure of 0.4%.
Derren Martin, Head of Current Valuations at cap hpi, said: “The market continues to strengthen and there is no immediate end in sight. Auction conversion rates are high, and those businesses that remarket direct to retailers are reporting they are ‘making hay while the going is good’.
“Lower than expected new car registrations in January boosted the strength of the used market, and there are fewer fleet returns and part exchanges hitting the used car market.
“Dealers are also particularly focussing on selling used cars due to uncertainty over new car volumes this year. Buyers have to pay the going rate, and there is little need for vendors to negotiate.”
“The strength in used demand and prices are likely to continue through February and into March, when pressure from new car activity and increased volumes in the used market may temper some of this positivity.”
Average Price of New Car Rises by 38%
Analysis from cap hpi has found that the average price of a new car has risen by 38% over the past decade. In February 2008, the average price of a new car was £24,383 compared to the same month in 2018 where it has risen to £33,559.
The rise in average price has been put down to the growth of expensive diesel car sales and the increasing use of PCPs.
Managing Consultant at cap hpi, Matthew Freeman, said: “The real driver of this is the changing structure of the marketplace. Over the past decade, we’ve seen more expensive models being rolled out. We see more SUVs on our roads, and they are usually more expensive than the equivalent saloon.
“Many brands have moved to offer a more luxurious specification mix and eliminated their entry-level specifications. This is partly a response to PCP making cars more affordable, and consumers moving up to more expensive models. It’s also worth noting that those base models were not especially desirable in the used market, and had poor resale values.
“PCP has also shifted focus from the entry price to the monthly repayment and having a model to advertise as ‘From £9,995’ is no longer a priority – cars are more likely to be advertised on their monthly payment.”
Motor Sector Urged to Back Gender Equality
The Institute of the Motor Industry has called for motor retailers to back gender equality, claiming the sector currently had a ratio of five men to one woman.
Chief Operating Officer of the IMI, Lesley Woolley, said: “Currently we have very few women working in our industry. However, I’m proud to see that there is a sea-change in women coming into the sector through apprenticeships.
“Plus, a number of organisations within the sector have evolved to place more strong and empowering females in senior management roles.
“The IMI is an example of an organisation that has a positive gender diversity at all levels. We currently operate with a 70% female to male split, and we believe it’s important that other businesses in our sector recognise the value of creating a competitive advantage by embracing diversity. More women should look at the retail motor industry as a place where they can create a legacy.”
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