Used car sales accelerate as supply issues hit new motors

ALMOST 2.2m used cars were sold in the three months to June – the second-highest quarterly figure on record – as supply problems dampened demand for new motors.

The total was more than double the same period last year, according to the Society of Motor Manufacturers and Traders.

The boom was driven by pent-up demand after successive pandemic lockdowns and a global chip shortage that has strangled the production of new vehicles.

Mike Hawes, the society’s chief executive, said the latest figures were a relief for the beleaguered industry hammered by Covid curbs.

“More motorists are turning to used cars as supply shortages continue to affect the new car market, and the increased need for personal mobility with people remaining wary of public transport as they return to work,” he said. “A buoyant used car market is necessary to maintain strong residual values which, in turn, supports new car transactions.”

The sale of second-hand cars between April and June was 6.6pc higher than pre-pandemic levels, but similar to levels last summer when the initial national lockdown was lifted.

The trade body expects sales to remain robust during the next quarter as the summer tends to be one of the busiest times of year for purchases.

However, last week it reported that new car sales suffered their worst hit since 1998, and drivers were giving up on looking for new models due to a lack of availability.

A global microchip shortage has led to a raft of car companies being forced to halt production in recent months as they do not have the essential chips to build vehicles. This has driven up the price of used cars for an unprecedented four months running.

There are fears within the industry that the semiconductor shortage could last well into next year.

Mr Hawes added: “We now need to see a similar rebound in new car sales to accelerate the fleet renewal necessary to deliver immediate and continuous improvements in air quality and carbon emissions.”