Used car auction prices have been higher in the early months of 2009 compared to the end of 2008, according to Retail Motor Industry’s Society of Motor Auctions (SMA).
However, SMA chairman David Scarborough has warned that without an upswing in new car sales the auction boom is likely to come to an end.
With used car demand up around 20% in January alone, car dealers are searching for new stock.
The SMA’s membership has reported that all auctions were breaking sales records and had continued to do so until volumes dwindled leading up to March registration change.
The change was dramatic, as at the end of 2008 values were low, and auctions were quiet.
Scarborough said: “The auctions sector late in 2008 reflected the overall gloomy trend in the retail car sector with price reductions, little activity, and very few deals being struck.
“The start of 2009 looked healthier as most auctions had large volumes of cars already carried over from December. But we were about to experience a serious and exceptional demand that would outstrip supply immediately.”
He said that if anyone visited an auction in 2009 they would be surprised that the UK is in an economic slowdown.
Scarborough added: “While the pattern of an upswing in auctions activity in the early months is similar to previous years, the difference is the incredible scale of the increased activity and the subsequent prices achieved against the last third of 2008.
“With new car sales likely to continue at a much slower pace than previous years, the used car at auction will continue to be in big demand but for all our sakes we need volume to hit the market once more, bringing a little reality and overall prosperity back to all in the motor trade.”