Retailers missed out on practically £25.5m in potential revenue in March by pricing their inventory under their true market worth.
Auto Dealer’s reported that just about 7,700 of its circa 15,000 retailer companions marketed their vehicles under their present worth with every retailer leaving a median of £3,300 in potential income on the desk in consequence.
Its Retail Worth Index discovered the common retail worth of a used automotive was £17,712 in March, which on a like-for-like foundation is up 2% year-on-year (YoY).
Whereas used automotive costs have grown YoY for 36 consecutive months, the speed of development has step by step eased since April 2022, when it had reached its peak of 32.2% YoY. March marked a reversal of this pattern, nonetheless, rising from the 1.3% YoY recorded in February.
The acceleration in value development, Auto Dealer stated, is the results of the continued challenges in used automotive provide (down -11% YoY in March), and the current strengthening in client demand (up 12% YoY).
The expansion in demand has translated into used automotive gross sales, which in keeping with Auto Dealer’s sales-proxy knowledge grew circa 9% YoY in March.
It means gross sales within the first quarter of 2023 have been up round 7% on the identical interval final yr, however down practically 5% on pre-pandemic ranges as a result of ongoing shortfall in youthful vehicles.
Auto Dealer’s knowledge exhibits provide ranges of 1–3-year-old and three–5-year-old vehicles, have been down -22.3% YoY and -25.4% YoY respectively final month.
Final month, used vehicles took a median of 26 days to depart retailers’ forecourts, two days quicker than March 2022, and three days quicker than 2019 ranges.
Auto Dealer’s director of knowledge and perception, Richard Walker, stated: “Given the stream of damaging newspaper headlines, for many individuals the outlook for 2023 didn’t look promising. However in opposition to a backdrop of political and financial uncertainty, used automotive costs, and the market extra broadly, has gone from strength-to-strength in Q1. It’s a really encouraging begin to the yr and these robust market indicators provides to our assured outlook for the months forward.
“Whereas different components of the financial system are subdued, the automotive business is as soon as once more proving its resilience, however many retailers are inadvertently leaving revenue potential on the desk. To make sure companies are securing the strongest margins doable, it’s very important they observe the information.”
Sue Robinson, chief govt of the Nationwide Franchised Sellers Affiliation (NFDA), added: “As Q1 involves an in depth, it’s a very good alternative to take inventory of the present well being of the market. It’s extremely encouraging to see an acceleration in value development and client engagement on Auto Dealer. With the common retail worth of used vehicles up 2% year-on-year, on a like-for-like foundation, coupled with sturdy client urge for food, sellers are assured that the robust ranges of buying and selling exhibited within the opening months of this yr, will proceed into Q2.”