Latest data from Auto Trader, the UK’s leading digital automotive marketplace, signals robust underlying demand from car buyers, despite the closure of retailer forecourts across the country. Further, Auto Trader metrics indicate that once lockdown restrictions begin to lift, consumers will be poised to buy their next car.
In the midst of the global pandemic, the Auto Trader Retail Price Index shows the average retail price of used cars is fairly stable with like-for-like prices remaining flat at -0.2%, at £13,601. This comes as industry valuation companies have announced that no adjustments will be made to trade prices; prices have been held for the time being.
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Looking at the data on a more granular level, with the exception of petrol, which recorded a small growth of 0.5% (£12,354), all fuel types saw a small like-for-like dip in sticker prices last month. Diesels declined -1.2% (£14,485), and in terms of alternatively fuelled vehicles, used prices fell -1.4% (£22,044). At -3.8% (£25,727), pure electric vehicles recorded the sharpest decline.
The ‘lockdown’ introduced on 23rd March produced a noticeable response from the market in regard to pricing changes. Typically, circa 12,000 price changes take place on a daily basis. The day before the restrictions on movement had been put in place, this increased to 17,055; a year-on-year growth of +26.5%. However, after the Prime Minister’s announcement, price changes have fallen to an average of just 5,885; a -39.1% fall year-on-year.
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Although consumers can’t visit retailers under the lockdown rules, latest Auto Trader figures show they are still interested in buying as there has been an increase in engagement across its platform. Over the last week of March, there was an overwhelming number of vehicles ‘saved’ – vehicle adverts saved as a favourite choice – an increase of 8% compared with the same period last year. In addition, data for March reported a very high advert view per user session number, meaning that Auto Trader visitors are viewing more adverts per visit than normal.
Recent research conducted among car buyers by Auto Trader revealed 88% of shoppers said they would spend the same amount or more time researching their next car while in lockdown, and 60% said they still want to buy, but not right now. Approximately one in five (21%) said they’re currently in the research phase, while 15% said they’re looking to buy imminently. Just 4% said that they are no longer looking to buy a car.
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Numerous Auto Trader datasets suggest that when the Government’s isolation restrictions are eased, consumers will be ready to buy, and retailers should be prepared for this.
Richard Walker, Auto Trader’s Data and Insight Director, says: “There’s no question the industry is facing a huge pressure, but to ensure we can return to health as quickly as possible; we urge retailers to resist the temptation to reduce prices. Many of our indicators suggest the market is capable of picking back up almost where we left off before the COVID-19 pandemic shook the industry, and we must be ready for when the Government restrictions lift.
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“Despite consumers being unable to visit physical forecourts, they’re still visiting and engaging with digital showrooms. We can see that not only are they saving their favourite vehicles and using this time to research their next car, but they’re also making enquiries. It’s therefore more important than ever that retailers are visible online to capture this consumer demand and be ready to engage with potential customers. By doing so, they’ll be in the very best position for when they can reopen their doors.”