The UK used car market continued to strive in August, with retail values for three-year-old vehicles experiencing an increase for the first time since January, despite the typical slowdown associated with the summer holiday season, says Percayso Vehicle Intelligence. It has been a healthy year for used cars overall, and it appears to be strengthening in the short-term.
New figures from Percayso show retail values for three-year-old cars saw a modest increase of 0.1% on average. While this equates to a rise of approximately £25, it marks a positive shift after a period of stability. Demand has remained robust, defying the usual seasonal trend of consumers being less focused on car purchases during the holiday period.
A notable trend observed in August was the performance of different fuel types. Diesel vehicles led the charge with an average increase of 0.6% (around £100), a rise attributed to a significant reduction in supply coupled with sustained demand. Petrol cars also saw a healthy increase (up 0.4%), while hybrids edged up by a negligible 0.1%.
Electric Vehicles (EVs), although experiencing a slight drop of 0.2% or approximately £30, saw a less significant decline than in the previous month, with values varying considerably by model.
Commenting on Percayso’s latest market update, automotive expert, Derren Martin, said: “August has proved to be a strong month in the used retail market, despite the holiday season being in full swing, with advertised values actually increasing for the first time since January.
“It is interesting that diesel cars increased in value the most, pointing towards robust used demand for this fuel type that is ailing in the new car world. Whilst EVs did not go up in value overall, they only dropped by a negligible amount, and interest continues to increase, with the government grant piquing interest across the new & used arena.”
Land Rover was the standout brand, with values for its three-year-old vehicles surging by an impressive 3.7% in August, building on a strong increase in July, suggesting the brand’s resurgence following its well-publicised price adjustments over the last few years.
While Mini and Vauxhall also performed well, three brands saw negligible drops in value: Renault (-0.5%), BMW (-0.2%), and Kia (-0.1%).
The £10,000 to £20,000 price bracket saw the most significant value increase at the three-year-old age point, rising by 0.3%. In contrast, vehicles priced under £5,000 dropped by 1.3%.
While SUVs saw a small drop (0.2%), demand for small hatchbacks pushed their values up by 0.5%. MPVs were the strongest performers (up 3% or over £400 on average), as a result of their scarcity in the new car market and continued demand from families during the summer.
Car supermarkets continued their impressive performance, with prices increasing by 1.4%, mirroring trends from June and July. Independent dealers saw a drop of 0.5%, while franchise dealers remained level.
Derren added: “It is good to note that across all areas of the used car market, demand has been strong. All eyes are now on the key month of September to see what stock gets generated by the plate-change month.
“Overall volumes of cars advertised in August were similar to the previous month, indicating a stable supply-demand balance.”