The Society of Motor Manufacturers and Traders (SMMT) has reported that used car sales slipped by just over 1% for 2017 compared to the record levels of 2016.
More than 8.1 million used cars changed hands in 2017, which includes everything from cars being swapped with families (parents to kids, husbands to wives and so on), through cheap private sale £250 bangers all the way to dealer demonstrators and pre-registered cars that are maybe only weeks old.
This still makes 2017 the second-highest year on record for used car sales, but looking at the results across the course of the year, it’s clear that the patterns have been following new car sales.
The year in review – a fast start, flagging middle, faded at the end
The year started very strongly for used car sales, with the first three months seeing more than 3% growth on the previous year’s record levels. However, like new cars, that was then followed by three consecutive quarters of falling sales. The second quarter (April-June) saw used car sales fall by under 1%, then a 2% drop in the third quarter (July-September), and finally a 5% slide in the last three months (October-December).
Looking ahead to 2018, this slowdown is likely to continue, although the used car market is expected to continue pulling sales from new cars as appears to have been happening for the last nine months. With road tax for most new diesel cars set to increase in April, we may see an even greater shift of diesel customers moving away from new cars and into used cars.
Dealer financing of used cars was at record levels in 2017, with more than £15 billion borrowed by used car buyers through dealer-sourced car finance. As personal contract purchase (PCP) offers continue to become more popular for used car finance, this is expected to keep on growing.
Petrol and diesel still make up 99% of used car sales
Within the overall figures, petrol remains the most popular fuel, despite a 4% decline in sales, with 58% of the market. Diesel sales increased by 3% over the course of the year, holding just under 41% of the market. This suggests that a significant number of potential new diesel sales have shifted to used diesel cars instead, as buyers steer away from investing big money in new diesel cars.
It was a year of strong growth (albeit based on tiny overall numbers) for alternatively-fueled vehicles (AFVs). Petrol-electric hybrid sales increased by 22% and pure electric vehicles increased by 77% as more of these cars hit the used car market. Between them, however, AFVs make up less than 1% of the overall used car market, with the other 99% being petrol and diesel cars. With new car registrations now regularly showing more than 5% market share for AFVs, this will trickle down to the used car market soon enough.
To absolutely no-one’s surprise, given that it’s been the most popular new car for about a million years, the Ford Fiesta was the top-selling used car of 2017. In second place was its larger sister, the Ford Focus, with the Vauxhall Corsa third.
Inevitably, the SMMT couldn’t resist taking a shot at the government over new car registrations, even though it was a used car press release. Unfortunately, the car industry’s lobby group sounds increasingly out of touch with what consumers actually want from their cars, and apparently has no plans to start listening anytime soon.