The number of dealers feeling negative about the used car market has almost quadrupled in a month, according to this month’s Startline Used Car Tracker.
In November’s survey, 49% say they are pessimistic in outlook compared to 13% in October. Conversely, the percentage who are optimistic has fallen from from 23% to 8%.
Dealers whose view of the market is unchanged have remained stable at 42% now against 45% last month.
Reasons for pessimism include worsening consumer confidence, mentioned by 83% of dealers, weakening stock supply at 27% and reduced availability of motor finance, mentioned by 24%.
Finally, dealers were asked about the biggest challenges their businesses faced for the future. Stock availability remained the top concern at 76%, in line with recent months, but availability of motor finance was also a worry, cited by 67% of dealers compared to 34% in October.
Paul Burgess, CEO at Startline Motor Finance, said, “We’ve been through a period in the last few weeks of intense economic and political turmoil that has had a direct impact on the personal finances of many people, so it is unsurprising that dealers are feeling as though things look more bleak.
“However, it has to be said that although there is obviously quite a lot of pessimism out there, our own feedback from a business point of view is that the market continues to show an incredibly high degree of resilience. Dealer confidence might be falling but most continue to sell used cars successfully.”
He added, “The hope is that having a new prime minister in place, along with a new set of comparatively sustainable economic policies, will create more of a sense of stability and dealers will hopefully feel a little more secure within a few months – although there are clearly several major downside risk factors in play that could spoil this prospect.”
The Startline Used Car Tracker is compiled for Startline Motor Finance by APD Global Research, well-known in the motor industry for their business intelligence reporting and customer experience programs. This month, 305 consumers and 59 dealers were questioned.
Almost a third of motorists are planning on keeping their current vehicle for longer due to the cost-of-living crisis.
A poll by Close Brothers Motor Finance showed 32 per cent of drivers now expect to keep their car and more than one in ten (11 per cent) also said they have sacrificed the vehicle they wanted in favour of a cheaper car, in news that could worry dealers and some have even considered switching to a motor-bike instead.
The result is that some used models which had been very popular six months ago are no seeing dramatic falls in prices as dealers need to shift them, with some BMWs and Fords being particularly badly hit.