The number of used cars sold fell by nearly a fifth in the second quarter as supply issues put the brakes on the new car market and the availability of second-hand vehicles hit the availability of second-hand vehicles.
In the second quarter of 2022, figures from the Society of Motor Manufacturers and Traders showed a 18.8 per cent decline, with 1,759, 684 transactions. Some 407,820 vehicles changed hands last year, compared to the same period last year.
The trade body said that the long-running shortage of semiconductors continued to affect the supply of new cars, with an inevitable knock-on effect on used transactions.
While the decline in the second quarter was artificially inflated by comparison with 2021, when the easing of Covid restrictions resulted in the busiest second quarter since records began, it was also 13.5 per cent down on pre-pandemic levels.
In each month, declines were recorded, with falls of 16.8 per cent, 20.9 per cent and 18.6 per cent in April, May and June. In the year to date, the market is down 8.3 per cent and 12.8 per cent lower on 2019 compared to 2021, which is why it is down 8.3 per cent.
Chris Knight, UK automotive partner at KPMG, said: With the market's rate of new cars falling significantly on previous periods as manufacturers struggle to solve supply issues, consumers are holding onto their vehicles for longer, resulting in fewer used car transactions.
Consumers are willing to pay a premium to avoid having to wait for a vaccine to occur, as the prices are much higher than pre-pandemic. There is evidence that price growth is cooling amidst a cost of living squeeze and a rise in the cost of driving. He added that consumer demand for used cars may drop in the coming months but the supply landscape is so that it is unlikely that we will see major price corrections in the near term. Despite the overall fall, sales of battery electric vehicles rose 57.1 per cent to reach 16,782 units, doubling the market share to 1 per cent, while plug-in hybrids held relatively stable with 1 per cent growth and 0.9 per cent of the market. Hybrids fell by 4 per cent, with 2.4 per cent of the market. The use of petrol and diesel vehicles remained dominant, accounting for 95.6 per cent of sales, totalling 1,682, 280 units and accounting for 95.6 per cent of sales.
Mike Hawes, the chief executive of the SMMT, said it was inevitable that the squeeze on new car supply would filter through to the used market. Britain's used car buyers clearly have a growing appetite for the latest low and zero emission cars, and we need a thriving new car market to feed it.
The next prime minister must create conditions to drive consumer confidence, especially in EVs electric vehicles to drive the fleet renewal necessary to meet our decarbonisation goals. The most popular segment types were supermini 31.4 per cent lower than medium 26.5 per cent and dual purpose 14.7 per cent Black cars were the most popular, accounting for more than one in five 21.5 per cent sales, followed by blue and grey. Pink cars were the least popular, comprising 1,135 units.