Car manufacturers and the iPhone generation

595 More

Earning the right to be successful

575 More

Knowledge is power

670 More

Selling cars – it’s all about timing

950 More

Truemag

  • Home
  • About
  • Advertise
  • Archives
  • Contact
  • Subscribe

Supply shortage fueling used car prices


There is a simple reason for the massive price correction on used cars at present, supply. With the new car market consistently down year-on-year, quite simply not as many cars are being built therefore not as many used cars will be generated as a result. The interesting aspect from a frustrated dealers point of view is that prices are actually similar to where they were in Jan 2008.The perception is prices have gone through the roof and the lack of supply means they have definitely strengthened but really the underlying factor is that because 2008 saw suchan unprecedented destruction of used car values the rise back up seems just as spectacular. Of course many dealers have still acted very cautiously and kept their inventories deliberately low for fear of a repeat of last year’s financial haemorrhage. Perhaps now, after 6 months of 2009 and a recession busting used car performance, the confidence factor is rapidly coming back leading to more increases in values.

The news is that the situation regarding stock availability is unlikely to change much in the second half of 2009 and although higher prices are not necessarily being fuelled by high and constant customer demand, there is a steadiness about car sales at present which is comforting to dealers and encouraging for future residual values.

We have had many reports of dealers, from across the used car spectrum, smashing their budgeted volume and profit targets and individual profit per unit has also remained solid due to prices rising steadily over this year.

Any units which need to be moved on to comply with the ageing policies are unlikely to lose much money as replacing similar cars is likely to be more costly than when the stock was bought 60-90 days ago, so swapping from dealer to dealer within a group or holding the retail margin is far easier to justify and ultimately a lot more cost effective.

Jul 8, 2009In51der
  • Used car prices? Take a wild guess!
  • Used car prices and simple supply and demand
  • Used Car Prices
  • Used car prices go beyond simple supply and demand
  • Auction houses doing good business as prices edge higher
  • With used car prices too high are new cars looking good again?
  • VW Tiguan The People's Reviewer – the voting has begunAll aboard the scrappage bandwagon
    In51der

    Motor Trade Insider - Bridging the gap between the customer and the Motor Trade

    13 years ago Blog, Consumercar sales, car values, economy, motor trade recession, profit, shortage of used cars, Used car, Used car buying, used car prices, used car shortage, used car shortage in 2009, used cars125
    Most viewed
    Top 100 UK Dealer Groups
    39,429 views
    The car sales process and the “9 point plan”
    11,450 views
    webuyanycar review – They will buy any car but beware of the asterisk
    5,971 views
    Most commented
    Car sales and the power of silence…
    25 Comments
    Car dealers still not prepared to play the “we buy any car” game
    23 Comments
    A Traders Tale – Part Four
    22 Comments
    Win a pre-loaded Ipod Shuffle!
    19 Comments
    Bargain of the Week – StreetKa 1.6i Luxury
    14 Comments
    Bridal Hair Berkshire
    Fox Body to 2018 Mustang Parts
    and Accessories
    About MTI

    Motor Trade Insider
    is written by people working actively in the motor trade for people on the inside and people on the outside.

    Our aims
    Build a bridge between consumers and the trade, create Interesting and informative content, break down barriers and create better understanding, expose bad practices and rip-offs and promote outstanding products and service.
    Have something to say?
    We are always looking for experienced writers who can write good original quality posts on motor-trade-insider.com. Please contact us if you would like us to consider you. Make sure you give us details of your own blog or a link to some articles you have written.
    2017 © Motor Trade Insider
    Truemag theme by StrictThemes