Used car price surge continued in February

Manheim’s latest Market Analysis reports that the upsurge in used car prices and demand first seen in January has continued right the way through February beyond the level of any normal seasonal uplift, with record numbers of buyers in the wholesale market. At £6,294, the average wholesale used car selling price was up 10.5% (£597) in February with all three sectors – Fleet, Dealer and Manufacturer – reporting increases. This latest Market Analysis report has been extended to include all vehicles sold through Manheim’s direct sales channel, vrs, which means that it is now the most comprehensive analysis of late plate vehicles in the market.

In the Fleet sector average month-on-month values rose by 8.6% (£439) following an increase of 9.2% (£430) in January, while in the Dealer sector average month-on-month values rose by 7.6% (£125) compared with a rise of 2.3% (£38) in the previous month. The Manufacturer sector also saw a month-on-month increase of 12.9% (£1,323) following an increase of 15.7% (£1,389) in January.

Examples of the increases in average wholesale used car selling prices in February compared with January include the Small Hatchback, Large Family and Compact Executive segments in the Fleet sector which rose by 7.5% (£287), 14.0% (£563) and 5.2% (£372) respectively. In the Dealer sector, the Supermini segment rose by 21.6% (£250), the Small Hatchback segment rose by 7.0% (£109), and the Medium segment rose by 2.1% (£33). Meanwhile in the Manufacturer sector there were increases in the Small Hatchback, Medium Family and Large Family segments of 8.0% (£573), 8.8% (£789) and 5.9% (£571) respectively.

Although most vehicle segments within each of the three sectors recorded increases in average values there were some segments that decreased when compared with January. In the Fleet sector Executives fell by 6.6% (£639) and the Coupe segment fell by 3.4% (£290). In the Dealer sector the Coupe segment fell by 6.1% (£191) and in the Manufacturer sector MPVs fell by 1.2% (£139).
Commenting on February’s Market Analysis, Mike Pilkington, Managing Director, Manheim Auctions & Remarketing said, “The continuation of this significant recovery in used wholesale prices and in demand demonstrates an acknowledgement by the motor trade that investment in used car retailing is an excellent way of combating falling profits. Despite these recent price increases, used cars continue to offer really good value and the consumer can clearly see this. However if the level of activity seen in the auction halls in the first two months of this year continues unabated there is a risk that the supply of good used wholesale stock will decrease.”