Used car market remains strong as uncertainty looms

The UK used car market remained buoyant in 2017, with a decline of just 1.1% across the year and 8.1 million cars changing hands. 

The apparent stability across the year was marred by a sharp 5.1% decline in the fourth quarter, in line with the 5.7% decline in new car sales across the year. 

The fourth-quarter results could be a forecast of things to come; the used car market is usually a few months behind the new market in responding to trends and changes. Automotive analyst Cap HPI recorded a drop in used car values of 1.1% in December, indicating greater stability in the market; values declined by 1.6% the previous December. 

Cap HPI Black Book senior editor James Dower said: “Historically, used car activity starts to improve after the Christmas period and values begin to strengthen. The used car market is likely to increase in volume due to the historic levels of new car registrations but, with the decline in new car volume, this should have a stabilising effect.”

Used car transactions involving diesels rose 3.3% over 2016, indicating both a keenness of owners to shift them, but also a prevalence of buyers willing to take them on. 

Used electric vehicle sales passed 10,000 for the first time - a 77.1% increase on 2016, while the alternatively fuelled vehicle market grew by 21.3% overall. 

SMMT chief executive Mike Hawes warned that things might not remain so buoyant without the correct steps from authorities. “While such healthy demand is reassuring, to keep it that way and accelerate renewal throughout the fleet – the fastest way to improve air quality – government must now restore confidence to the new car sector,” he said.

“Given the recent economic and fiscal uncertainty, particularly over diesel, consumers and businesses need clarity to encourage them to move out of their older vehicles and into newer, lower-emissions cars – whatever their fuel type.”

Despite the uncertainty, these figures are the second-best annual results recorded for the used car market, with 2016 marking the high point on record. Hatchbacks maintained their dominance, with the Ford Fiesta mirroring its top-selling new car position on the used market, while the Ford Focus was second and the Vauxhall Corsa third. Six of the top 10 best-selling used cars of last year were superminis. 

Also mirroring the new car market, SUVs were a fast-growing segment, with a 9.5% jump in demand for the models. Executive cars remained stable year on year, while all other segments declined. 

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