According to the latest data from the Auto Trader Retail Price Index, the current average retail price of a used car in March is £17,720. This is up 2.3% on a year-on-year (YoY) and like-for-like basis. Increasing from the 1.3% YoY increase recorded in February, it marks the first acceleration in the rate of YoY price growth in 10 months, having gradually slowed from the all-time high of 32.2% YoY in April 2022.
At a month-on-month (MoM) level, March to date is up 0.7% on February’s average prices, marking the third consecutive MoM increase after the typical seasonal slowdown over the festive period. It’s well ahead of the 0.1% MoM growth recorded in both March 2022 and 2021, as well as the pre-pandemic average contraction of -0.4% MoM recorded in March between 2011 and 2019.
Despite the acceleration in YoY and MoM growth, average used car retail price growth is being held back by the ongoing contraction in used electric vehicle (EV) values (£33,060). As of mid-March, these are down by 13% on the same period last year. In contrast, the average price of a used petrol (£16,102) and diesel (£16,236) car is up 4.3% and 2.4% respectively. This is a good thing for those in the market for a new electric car.
Auto Trader’s data, which is based on the broadest single view of electric vehicles in the market, shows that the drop in average used EV prices is the result of a huge overbalance of supply. Whereas traditionally fuelled vehicles are following the same trend in dynamics as the wider market, with the current supply of both used petrol and diesel cars down circa 20% YoY, the rate of stock growth of used EVs has rocketed, with supply up a massive 261% YoY.
Contrary to some reports that consumer interest in EVs is collapsing, on Auto Trader, levels of demand are currently up 47% on the same period last year. The huge surge in supply is also evident at a more granular level.
Since August, the iconic Nissan LEAF has seen stock levels increase a massive 313%. Supply of the Renault Zoe was up 235% and the Tesla Model 3 was up 148%. This dramatic uptick is resulting in a significant softening in values – since September, one-year-old Model 3 prices have fallen around £8,000 and show no sign of slowing.
Richard Walker, Auto Trader’s Director of Data and Insights, said: “Despite some of the recent reports, it’s clear that consumer demand for EVs remains very robust, so it’s important that we correct the myth that consumers don’t want them and that they don’t work.
“With the sub-five-year-old EV parc expected to grow 62% this year, we’ll need to work together as an industry to change the narrative and we need to change it fast to avoid more than just a pothole on the road to 2030. Encouraging car buyers into used EVs through incentives, marketing and information to demystify them will be critical.”
