Fleet News

Used car industry grows to a massive £32 billion

THE UK's used car industry was worth a record £32 billion last year – mainly due to the popularity of ex-fleet and company cars.

Much of the growth noted among key players was in the three to five-year-old sector, typical ex-fleet cars.

Used sales volumes in this sector shot up by 180,000 units year-on-year to 2.08 million and accounted for 19% of the marketplace, according to the 2004 Used Car Market Report from BCA and Fleet News' sister company Sewells International.

The report said: 'The figures represent an increase of 637,000 units and an additional £3.9 billion in value year-on-year. It was the second year running the volume had increased following five consecutive years of falling volumes between 1997 and 2001.'

The report also found that a fifth of used car buyers chose diesel, compared to 15% two years ago.

It said: 'This rising demand for used diesel cars from motorists shows no signs of slowing and mirrors strong sales in the new car sector.' This finding comes as forecasting expert Henley Autodata said fears of a collapse in diesel values were 'ludicrous'.

Operations director Martin Keighley said: 'In broad terms, the overall market prices for three-year-old, 60,000 mile diesel cars will fall by 10% for diesels and 6% for petrol cars over the next three years.

'We believe the falls will, rather like the housing market, be steady and gradual rather than a market meltdown as sometimes predicted. Much has been written about steep drops in diesel values but caution is needed before a wave of diesel bashing hysteria sweeps the country.'

The BCA report also reveals that the main reason for choosing a used car remains the make and model, at 51%. But buyers are also placing a bigger emphasis on 'low mileage' than in recent years, at 42%.

Other main factors are the age of the car (29%), its body type (25%), specification (17%) and the insurance group (15%). The popularity of the internet when choosing a used car has grown, the report found, with nearly two-thirds of respondents with access to the internet saying they would use the technology to find their next vehicle.

The survey is based on interviews carried out with 2,900 respondents aged 17 and over.

  • Copies of the report, published next Monday, cost £149.95 plus postage and packing and can be ordered by calling 01733 468254.

  • Subscribe to Fleet News.
  • Get the news delivered to your desktop
  • Leave a comment for your chance to win £20 of John Lewis vouchers.

    Every issue of Fleet News the editor picks his favourite comment from the past two weeks – get involved for your chance to appear in print and win!

    Login to comment

    Comments

    No comments have been made yet.

    Compare costs of your company cars

    Looking to acquire new vehicles? Check how much they'll cost to run with our Car Running Cost calculator.

    What is your BIK car tax liability?

    The Fleet News car tax calculator lets you work out tax costs for both employer and employee