In September, used car sales saw a notable increase as consumers moved away from new vehicle purchases, driven by economic concerns and affordability issues.
- A significant rise of 4.3% in used car transactions was recorded from July to September, equating to 1.96 million sales.
- Electric vehicle (EV) sales in the used market surged by a remarkable 57%, although they remain a small fraction of total sales.
- Private consumer purchases in the new car market dropped by 4% in the third quarter, highlighting a shift towards more cost-effective options.
- Industry experts emphasize the critical role of affordability and government support in maintaining the growth of the used EV market.
The used car market experienced a robust 4.3% growth year-on-year from July to September, with transaction numbers reaching 1.96 million. This marks a substantial shift as consumers increasingly consider second-hand vehicles due to economic uncertainty and financial considerations.
Despite the overall dominance of petrol and diesel vehicles, which make up 91.7% of the market, electric vehicles (EVs) have shown a significant growth. Used EV sales jumped by 57%, reaching 53,423 transactions, which is around 19,000 more than the previous year. Nevertheless, EVs still represent just 2.7% of the total used vehicle market.
Traditional models such as the Ford Fiesta, Vauxhall Corsa, Volkswagen Golf, Ford Focus, and Mini remain popular in the used market. This trend underscores a preference for reliable and well-known options among consumers seeking value for money.
In contrast, new car sales, particularly among private consumers, fell by 4% in the third quarter. This decline reflects a broader hesitance to invest in new vehicles, possibly driven by prevailing economic uncertainties, leading consumers to explore more affordable alternatives like used cars.
Ian Plummer, Auto Trader UK’s commercial director, highlights the growing demand for ‘middle-aged’ EVs, typically three to five years old. These vehicles are now selling faster than other used cars on Auto Trader’s platform, illustrating the increasing consumer focus on affordability in their transition to electric.
However, Mike Hawes, CEO of the Society of Motor Manufacturers and Traders (SMMT), cautions that the expansion of the used EV market is contingent on the health of the new car market. He underscores the necessity of strong consumer confidence and government incentives to sustain both markets, which in turn could affect the affordability and availability of used EVs.
Government policies, particularly the Zero Emission Vehicle (ZEV) mandate, are influencing the market dynamics. This policy sets sales targets for car manufacturers who are penalized if the targets are not met. It is suggested that some manufacturers might be limiting the availability of petrol and diesel models to avoid these penalties.
Overall, used vehicles dominate the UK market, accounting for approximately four out of five car sales. In the first nine months of 2024 alone, used vehicle sales increased by over 330,000, culminating in 5.89 million total sales.
The evident shift towards the used car market underscores a growing consumer preference for affordability and value amidst economic challenges, particularly influencing the demand for used electric vehicles.
