Used car market stability provides positive outlook for H2

The used car market is “well positioned” for a successful second half of the year, according to Autotrader. 

Its latest data shows consumer confidence is robust - cars are selling at near record speed and prices remain stable across segments. 

The average price of a used car was £16,786, in July, which is flat on both a month-on-month (MoM) and a year-on-year (YoY) basis.  

It’s the fourth consecutive month prices have been flat YoY, following 19 months of contraction, which Autotrader said “reflects positive underlying market dynamics”.  

Autotrader’s Market Health metric recorded its first upturn since January; up 1% on the “very robust” 8% growth recorded in July 2024. It’s been fuelled by the slowing of the overall rate of supply growth (+1.1% YoY) combined with robust levels of demand, which grew 2% YoY in July, on top of last year’s 10% increase.  

This strength in demand is helping to fuel faster vehicle turnover: on average, used cars were sold every 29 days in July, one day quicker than last year, and three days quicker than July 2023 - a clear indicator of heightened used car appetite.  

Autotrader’s car buyer research also indicates consumer confidence remains stable, with nearly half (44%) of 1,000 consumers surveyed in July feeling ‘much more’ confident in their ability to afford their next car than they were last year.  

Separate Autotrader research of more than 2,000 people revealed that circa 70% are looking to purchase within the next six months.  

Marc Palmer, head of strategy and insights at Autotrader, said: “The combination of swift sales, increasing site visits, and stable pricing underscores a dynamic and resilient sector, which should provide confidence for retailers as the market heads into the remainder of 2025.  

“However, there remain significant nuances and challenges in the market around supply, which is making the job of finding profitable cars increasingly more competitive.”  

The used car market rose by around 3.3% YoY in July, with independent retailers seeing the largest (6.1%) rise. 

Franchise dealers have been hit by a sharp drop in the supply of three-to-five-year-old cars, since the pandemic and its related supply chain effects that lasted until mid 2023. 

Independent retailers have been less affected by these supply issues and have benefited from rising consumer demand for older, more affordable cars. 

The maturing used EV market continues its rapid growth, with overall supply soaring 42.4% YoY (up from 38.1% in June), and demand climbing 37.8% YoY (up from 28.6%).  

With supply levels only just outpacing the otherwise very strong levels of consumer demand, retail prices are continuing to stabilise: the average price of a used EV was £24,727 in July, which marked a 0.4% MoM increase, the only fuel type to record growth last month. Although on a YoY basis, prices softened -6%, it’s up from -7.6% recorded in June, and the lowest level of contraction since January 2023.