USED CAR MARKET HAS BEEN RESILIENT DURING FIRST HALF OF 2023 – REPORT

The used car market showed signs of a steady recovery during

That’s according to a wide-ranging analysis by Cox Automotive, which revealed that data captured by its Manheim Auction Services, Dealer Auction and NextGear Capital brands over the first half of the year pointed to a resilient marketplace buoyed by strong demand and improved year-on-year performance..

Consumer demand for used vehicles has continued to grow in line with Cox Automotive’s forecasts, despite new vehicle supplies slowly returning to near-normality. And while the new market has had a more pronounced return, it’s come from a much lower base.

Some of the growth comes from the the first six months of increased supply of de-fleeted vehicles into the marketplace as the lease and rental sector has moved to replenish stock.

Experts at Cox Automotive believe wholesale activity is showing the traits that will define the market. Comparing the past six months to the same period in pre-pandemic 2019 shows that the average used vehicle entering the wholesale market today is older, carrying more miles, costs more, is selling faster and commanding a stronger margin, they said.

In particular, NextGear Capital data shows the average used vehicle is 23 per cent older (7.5 years in H1/23 vs 6.1 years in H1/19) and carrying 13 per cent more miles (68,671 vs 60,848).

2023.

Manheim’s data paints a comparable picture. Its average wholesale sold price of a used vehicle was 33 per cent higher than in H1/19 and three per cent closer to Cap Clean (96.4 per cent vs 93.8 per cent).

Meanwhile, the average retail margin as captured by Dealer Auction has risen by four per cent vs H1/22. (NB: Retail margin data wasn’t captured in 2019.)

Used cars are selling slightly more quickly than they did before the pandemic according to NextGear Capital, at 60.3 days per vehicle in H1/23 vs 61.5 in the first six months of 2019.