More than two million used cars changed hands in the first few months of this year, shows data from the Society of Motor Manufacturers and Traders (SMMT). To be exact, there were a total of 2,020,144 transactions during this time, with March proving to be a particularly high-performing month in terms of sales.
Chief executive at SMMT, Mike Hawes, had this to say about the results:
“Amid ongoing political and economic uncertainty, a stable used car market is good news for the automotive sector as it underpins crucial new sales activity. Consumers are benefitting, too, as more of the latest, safest and cleanest vehicles filter through to second owners.”
Time to fill your forecourt
If you’re relatively new to the motor trade, or have just made the decision to set up your own used car business, we don’t need to tell you that the cars you choose to fill your forecourt with play a big part in your success.With your cars being your most valuable asset, it’s really important that you get them insured. Insurance Choice can provide you with a comprehensive motor trade insurance policy that will protect your cars and ultimately, your bottom line.
We provide motor trade insurance to part and full-time traders, and can also cover mechanics and valeters. No two motor traders are the same, and we take pride in offering policies that are flexible and reflective of your individual needs, as well as being competitively priced.
Which cars are good options?So, which cars are proving popular at the moment among buyers? The same SMMT report shared a list of the top ten best-selling models during Q1 of 2019. Here are the results:
|Model ||Cars sold during Q1 2019 |
|1. Ford Fiesta ||92,798 |
|2. Vauxhall Corsa ||79,424 |
|3. Ford Focus ||77,082 |
|4. Volkswagen Golf ||66,644 |
|5. Vauxhall Astra ||63,396 |
|6. BMW 3 Series ||47,572 |
|7. MINI ||42,175 |
|8. Volkswagen Polo ||39,894 |
|9. Renault Clio ||33,471 |
|10. Audi A3 ||31,604 |
These are the models that proved most popular during the first few months of this year, but which regions sold the most of them? Here are the top five:
|Region ||Number of transactions |
|1. South East ||299,237 |
|2. North West ||215,817 |
|3. West Midlands ||201,058 |
|4. East ||193,806 |
|5. South West ||188,470 |
While it’s a good idea to buy second-hand cars that are popular with buyers, what’s also important is that you consider which cars hold their value best. Choosing makes and models that retain their value the longest will help you to gain maximum profit when the car eventually sells.Autocar tackled the topic
of car depreciation in a blog post. It points out that, obviously, the quicker the depreciation, the less money you’ll get when you sell those cars. Especially if those vehicles are sat on your forecourt for some time before going to a new owner.
The article cited research from used car dealership Carspring, which reveals that of the top 13 car brands in the UK, Minis suffer from depreciation the least. Its cars lose around 46.88% from their value after 34,700 miles. Audi came second on the list, losing 47.33% after the same amount of miles.
Here’s the top 13 list in full:
|Car brand ||Depreciation rate after 34,700 miles |
|1. Mini ||46.08% |
|2. Audi ||47.33% |
|3. Volkswagen ||47.51% |
|5. Lexus ||51.59% |
|6. Ford ||53.49% |
|7. Vauxhall ||54.12% |
|8. Fiat ||54.17% |
|9. BMW ||55.82% |
|10. Kia ||59.27% |
|11. Nissan ||63.23% |
|12. Honda ||65.94% |
|13. Toyota ||74.59% |
We can’t tell you what to stock. However, from these lists, choosing cars you know are selling well and depreciate the least is certainly not a bad idea. Ignore these trends, and you might lose a lot of business to nearby competitors, or lose money by picking cars where the values plummet – fast.
Carspring co-founder Maximilian Vollenbroich speculates that “the future of the UK automobile market remains unclear.” However, many experts have suggested that Britain leaving the EU will push new car prices up, in turn inspiring more people to buy second hand. Meaning, it could end up working in used car dealers’ favour.
What other trends are there?
Back to the SMMT report... If you have a good idea of the cars you want to sell, next to decide is which colours to opt for. During the first few months of this year, black cars were the top choice among used car buyers, beating silver/aluminium and blue. Pink proved to be the least popular colour, even though there was a 27.1% increase in transactions – the largest rise among all hues.
Demand for hybrid, plug-in hybrid and pure electric cars also increased by 30.7%, with 32,272 cars sold. Among these alternatively fuelled vehicles (AFVs), hybrid cars saw the biggest growth, up by 34.2%, with pure electric sales increasing 4.8% to 3,067 units sold.
Yet, while AFVs are proving increasingly popular, they only accounted for just 1.6% of all transactions during Q1. So, you don’t want to start filling your forecourt purely with AFVs just yet!
Conventional petrol and diesel vehicles comprised 98.3% of the market, with petrol up 1.1% and diesel cars down 3.6%.
Motor trade insurance from Insurance Choice
Motor trade insurance, also called traders insurance or traders car insurance, provides full protection for people who work in the motor trade. We can set you up with a policy that includes protection for your premises on top of standard motor trade insurance.
We understand that every motor trade business is unique. So, whether you have 20 cars or 80, trade part or full time, and have people working for you or not, we have a policy to suit you.
Insurance Choice has access to a leading panel of insurers who can provide specialist motor trade insurance that reflects your individual circumstances and fits within your budget. Get a free, no obligation quote today.