Analysts predict sector to be badly hit by economic slowdown
Used car values are set to fall by 12 per cent between now and Christmas, according to EurotaxGlass’s.
The analysts said the decline would be caused by falling retail demand and a plentiful supply of second-hand vehicles.
“Retail demand will remain weak in August, and the widely held view is that the market will remain difficult for the next few months at least,” said Adrian Rushmore, managing editor at EurotaxGlass’s.
“We anticipate that trade prices will continue to fall at a greater rate, month on month, between now and the end of the year compared to one year ago.
“More positively, if the amount of new and used car business continues to ease back, so too will the number of part-exchanges entering the market.
“It may be that these smaller numbers will be better aligned to the lower trade demand, with the consequence that price falls will be less severe.”
Rushmore said that would only be possible once the current oversupply in the trade was at more manageable levels but warned there was no immediate prospect of this happening.