A “busier than expected” start to 2023 continued to drive the used car sector’s imbalance between supply and demand – propelling values to a record £18,937 on eBay Motors.
A seventh consecutive month of value increases on the new car marketplace brought a month-on-month rise of £837 to the average vehicle, leaving the top line value 4% up on January 2022.
The result reflects that previously reported by market rival Auto Trader, which reported an average retail price of £18,119 in January – up 2.7% year-on-year – last month.
‘Essential’ car purchases
Lucy Tugby, marketing director at eBay Motors Group, said: “Many dealers we have spoken to have reported a busier than expected January with some tracing rising buyer activity from as early as Boxing Day.
“This commitment to spend reflects just how essential a car purchase is for most buyers, especially in the current economic climate where household budgets are under pressure.”
Tugby added: “Healthy consumer demand for used cars, in a market with fewer units available, helped drive the seventh consecutive rise in average prices to £18,937, the highest we have ever tracked on Market View.”
On Friday (February 10) the Society of Motor Manufacturers and Traders’ (SMMT) used car sales data showed that the automotive sector’s new car “supply “squeeze” had resulted in an 8.5% decline in sales during 2022.
Playing the stock market
But the stock shortages have maintained high margins for retailers who are able to source vehicles.
January’s eBay Motors market data showed that franchised retailers drove value growth hardest, with average used car prices up 5% to £24,773. Independents increased prices 3% to £14,087 and car supermarkets by 1% to £18,640.
Stock levels dropped 7% from 59 to 55 units month-on-month on average, with independents feeling the brunt of the reduction – down 11% from 37 to 33 units as car supermarkets volumes declined 3% from 412 to 398 units and franchised dealers remained unchanged at 85 units.
Days to sell lengthened by three days to 42 days month-on-month, with franchised dealers holding onto cars four days longer (34 days) car supermarkets six days longer (37 days) and independents seven days longer (54 days) than in December.
According to eBay Motors, the fastest sales by price brand were achieved by vehicles advertised from £15,000-£19,999 (35 days), followed by £20,000-£40,000 (39 days), with demand for Vauxhall’s Corsa triggering a 9% month-on-month average rise to £20,221 – up 21% year-on-year.