Fleet News

Marketwatch: Experts predict a quieter fourth quarter

THE used car market is expected to be quieter during the fourth quarter of the year than it was in the same period last year.

But although the market is heading into a seasonal decline it is unlikely that trading conditions will deteriorate seriously, according to Glass’s Car Market Index.

It says that at the end of September the market appeared reasonably active but, in fact, there was steady demand with some unexpected shortages in supply.

The shortages are down to two main reasons – a lack of part-exchanges due to seasonal fluctuations in car sales and the fact that rental cars had not been de-fleeted to any large extent, the index suggests.

Glass’s Car Market Index managing editor Adrian Rushmore said: ‘Between early and mid-October the market dynamics began to change. At the start of last month dealers had largely satisfied their stock requirements and this became more apparent with the reduction in used retail sales.

‘Some franchised dealers were precluded from buying because used stocks had to stand the burden of incoming ex-demonstrators and self-registrations. At the same time, used car supply began to increase significantly from all the regular sources.’

On prices, Rushmore said: ‘Prices held reasonably well until the first week of October but then came under some pressure.

‘There is always a pivotal time in late autumn when the negotiation advantage moves from seller to buyer.

‘There were some indications around mid-month that this point was being reached as buyers tested vendors with lower prices without displaying any urgency to make a commitment. Furthermore, vendors also need to be a little more proactive by initiating enquiries with their best contact to see if a deal could be done.’

On models and sector Rushmore said large estates from both volume and prestige marques have been in good demand.

‘The same applies to diesel-engined cars featuring high-pressure direct injection technology. The price premiums for some prestige models continue to get wider,’ he added.

Other findings include large diesel MPVs ‘coming into season’ although their petrol equivalents are not responding so positively, compact MPVs enjoying more stable prices and large luxury saloons experiencing low demand and falling prices.

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