Will Coronavirus hit used car prices?

Will Coronavirus hit used car prices?

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Inky81

282 posts

95 months

Monday 8th June 2020
quotequote all
av185 said:
You need to look at whats happening on stock markets atm. Forward looking pricing.

So with recent rises of 20%+ those invested are hardly in the dumb money camp.

Whereas those who sold out/remain uninvested are hardly smart.
If you print enough money, you have to invest it somewhere.

So

26,271 posts

221 months

Monday 8th June 2020
quotequote all
av185 said:
So said:
av185 said:
So said:
av185 said:
So said:
av185 said:
The very fact that GDP drops could well mean used car prices rise as we are currently seeing across all sectors atm.
The rises you are seeing at the moment are short-term supply and demand aberrations. It won't continue.
The smart money says it will as punters see value and downgrade to cheaper residually robust and reliable quality used stock.
Who is "the smart money"?
The general market i.e. buyers.

They are rarely wrong.
You need to look up "smart money".

What you're describing is dumb money.
You need to look at whats happening on stock markets atm. Forward looking pricing.

So with recent rises of 20%+ those invested are hardly in the dumb money camp.

Whereas those who sold out/remain uninvested are hardly smart.
Sure, but you weren't talking about the stock market, you were talking about car buyers. You can't conflate the two.

growlerowl

334 posts

48 months

Monday 8th June 2020
quotequote all
jamoor said:
They went to the car park to have a picnic? I don't get it.
I know. They had sandwiches in foil and everything. I'm not making it up! There was a Halfords, Sofa shop, sports wear (pre Sports Direct) and a Currys I think along with the DIY stores so I can only think they decided to make a day of it at the retail park.
If my memory is not playing tricks the highlight of the day for me at least was seeing a Lotus Carlton in the car park as I collected trolleys. Used to get a few interesting cars there.

av185

18,433 posts

126 months

Monday 8th June 2020
quotequote all
So said:
av185 said:
So said:
av185 said:
So said:
av185 said:
So said:
av185 said:
The very fact that GDP drops could well mean used car prices rise as we are currently seeing across all sectors atm.
The rises you are seeing at the moment are short-term supply and demand aberrations. It won't continue.
The smart money says it will as punters see value and downgrade to cheaper residually robust and reliable quality used stock.
Who is "the smart money"?
The general market i.e. buyers.

They are rarely wrong.
You need to look up "smart money".

What you're describing is dumb money.
You need to look at whats happening on stock markets atm. Forward looking pricing.

So with recent rises of 20%+ those invested are hardly in the dumb money camp.

Whereas those who sold out/remain uninvested are hardly smart.
Sure, but you weren't talking about the stock market, you were talking about car buyers. You can't conflate the two.
They are inextricably linked.

So

26,271 posts

221 months

Monday 8th June 2020
quotequote all
av185 said:
So said:
av185 said:
So said:
av185 said:
So said:
av185 said:
So said:
av185 said:
The very fact that GDP drops could well mean used car prices rise as we are currently seeing across all sectors atm.
The rises you are seeing at the moment are short-term supply and demand aberrations. It won't continue.
The smart money says it will as punters see value and downgrade to cheaper residually robust and reliable quality used stock.
Who is "the smart money"?
The general market i.e. buyers.

They are rarely wrong.
You need to look up "smart money".

What you're describing is dumb money.
You need to look at whats happening on stock markets atm. Forward looking pricing.

So with recent rises of 20%+ those invested are hardly in the dumb money camp.

Whereas those who sold out/remain uninvested are hardly smart.
Sure, but you weren't talking about the stock market, you were talking about car buyers. You can't conflate the two.
They are inextricably linked.
How so?

Nefos

252 posts

83 months

Monday 8th June 2020
quotequote all
Joey Deacon said:
I would agree with that, I am interested in the under £5K, 10+ year old German automatic diesel cars (W204 CDi, E90 325/30d, Audi A4/6 3.0 tdi, E320 Cdi etc.) and prices definitely seem to be around 10/20% higher than when I was looking pre Covid. Anything keenly priced seems to sell the same day.

Porsche Boxsters also seem to have gone up in price, there are certainly not the £4K cars there were a few years ago.
What happened it seems is that most of the cars disappeared (probably sold) Monday a week ago, and the only cars there are left are the higher end of the market (either quality or just priced). Built up demand over the past few months has bursted on one week, so inventory is low. I am in the same boat, I rather wait a month or so for the chance of more stock coming back, but what people said over the past pages is that they think people who had newer expensive cars ditching them, so newish car prices are dropping, and buying older and cheaper cars so they own it outright isntead of a loan.

So either be fast or wait, as personally I dont want to buy an "overpriced" car (compared to normal market)

Deep Thought

35,724 posts

196 months

Monday 8th June 2020
quotequote all
Nefos said:
What happened it seems is that most of the cars disappeared (probably sold) Monday a week ago, and the only cars there are left are the higher end of the market (either quality or just priced). Built up demand over the past few months has bursted on one week, so inventory is low. I am in the same boat, I rather wait a month or so for the chance of more stock coming back, but what people said over the past pages is that they think people who had newer expensive cars ditching them, so newish car prices are dropping, and buying older and cheaper cars so they own it outright isntead of a loan.

So either be fast or wait, as personally I dont want to buy an "overpriced" car (compared to normal market)
And therein lies the problem right now. Anyone buying is probably buying the stock thats been sitting for the last three months and isnt being discounted as theres customers about for it, but trade ins, cars that would normally come from auctions, stock bought in hasnt yet made it to the forecourt, so theres little "new" there - particularly if you're looking for something different to the normal cooking variant.

The risk of buying now or buying soon is that not only will you suffer the usual yearly depreciation in the first year, but there will likely be added depreciation if the perceived price drop happens later in the year.

Also, if there is any price drop later in the year i dont think its going to be an instant 10%, its likely to be a small percentage per month

the-photographer

3,479 posts

175 months

Nefos

252 posts

83 months

Monday 8th June 2020
quotequote all
Deep Thought said:
And therein lies the problem right now. Anyone buying is probably buying the stock thats been sitting for the last three months and isnt being discounted as theres customers about for it, but trade ins, cars that would normally come from auctions, stock bought in hasnt yet made it to the forecourt, so theres little "new" there - particularly if you're looking for something different to the normal cooking variant.

The risk of buying now or buying soon is that not only will you suffer the usual yearly depreciation in the first year, but there will likely be added depreciation if the perceived price drop happens later in the year.

Also, if there is any price drop later in the year i dont think its going to be an instant 10%, its likely to be a small percentage per month
Yep, this is a heavy sellers market at the moment.

I am trying to wait as much as I can, as I dont drive a lot, my current car still okay (touch wood), but my car can break anytime with expensive repair bills, so I might need to replace it fast (I have a cheap banger, many issues and realistically too much money needs to be spent on it), so I hope by July/August the market will stablise a bit

Deep Thought

35,724 posts

196 months

Monday 8th June 2020
quotequote all
Nefos said:
Deep Thought said:
And therein lies the problem right now. Anyone buying is probably buying the stock thats been sitting for the last three months and isnt being discounted as theres customers about for it, but trade ins, cars that would normally come from auctions, stock bought in hasnt yet made it to the forecourt, so theres little "new" there - particularly if you're looking for something different to the normal cooking variant.

The risk of buying now or buying soon is that not only will you suffer the usual yearly depreciation in the first year, but there will likely be added depreciation if the perceived price drop happens later in the year.

Also, if there is any price drop later in the year i dont think its going to be an instant 10%, its likely to be a small percentage per month
Yep, this is a heavy sellers market at the moment.

I am trying to wait as much as I can, as I dont drive a lot, my current car still okay (touch wood), but my car can break anytime with expensive repair bills, so I might need to replace it fast (I have a cheap banger, many issues and realistically too much money needs to be spent on it), so I hope by July/August the market will stablise a bit
Yes, i'd like to see some new stock coming on to the market now, and some evidence i was getting a "good deal". Probably going to be very tricky to get both those aligned any time soon.


G_Morto

429 posts

57 months

Monday 8th June 2020
quotequote all
Got an email from WBAC this morning saying they’re back open for business, checked out of curiosity and my quote is also higher compared to pre-Covid.

Hopefully it’s still the case when I get round to selling for an upgrade

av185

18,433 posts

126 months

Monday 8th June 2020
quotequote all
So said:
av185 said:
So said:
av185 said:
So said:
av185 said:
So said:
av185 said:
So said:
av185 said:
The very fact that GDP drops could well mean used car prices rise as we are currently seeing across all sectors atm.
The rises you are seeing at the moment are short-term supply and demand aberrations. It won't continue.
The smart money says it will as punters see value and downgrade to cheaper residually robust and reliable quality used stock.
Who is "the smart money"?
The general market i.e. buyers.

They are rarely wrong.
You need to look up "smart money".

What you're describing is dumb money.
You need to look at whats happening on stock markets atm. Forward looking pricing.

So with recent rises of 20%+ those invested are hardly in the dumb money camp.

Whereas those who sold out/remain uninvested are hardly smart.
Sure, but you weren't talking about the stock market, you were talking about car buyers. You can't conflate the two.
They are inextricably linked.
How so?
Stock market investor confidence currently relatively high despite obvious volatility so prices rise as more cash is thrown in the markets against a derisory interest rate and liitle alternative asset class backdrop.

Car market is current strong post effective lockdown confidence among car purchasers high due to pent up demand relative affluence and restricted supply of quality used stock raising prices at all levels.

So

26,271 posts

221 months

Monday 8th June 2020
quotequote all
av185 said:
Car market is current strong post effective lockdown confidence among car purchasers high due to pent up demand relative affluence and restricted supply of quality used stock raising prices at all levels.
You're pretty much agreeing with my assessment; but it's not smart money entering the market.

You seem to be equating unsophisticated consumer spending with smart money. It's nothing of the sort. It's just the thick end of three months demand unwinding in an environment of restricted supply.

The buyers of most cars currently aren't buying due to a sophisticated understanding of the market or a bullish take on it. They just want or need a car.






av185

18,433 posts

126 months

Monday 8th June 2020
quotequote all
So said:
av185 said:
Car market is current strong post effective lockdown confidence among car purchasers high due to pent up demand relative affluence and restricted supply of quality used stock raising prices at all levels.
You're pretty much agreeing with my assessment; but it's not smart money entering the market.

You seem to be equating unsophisticated consumer spending with smart money. It's nothing of the sort. It's just the thick end of three months demand unwinding in an environment of restricted supply.

The buyers of most cars currently aren't buying due to a sophisticated understanding of the market or a bullish take on it. They just want or need a car.
Yep but if car buyers thought for one minute car prices would crash post furlough or on worsening GDP figures whatever etc many as evidenced on this thread claim they would delay purchasing on the probability of securing a bargain but this clearly isn't happening.

Similarly if investors thought there will be another imminent substantial dip in stockmarkets W recovery or markets would be substantially cheaper in a few weeks or months most wouldn't be investing long in the markets as is currently the case.

Confidence is strong at many levels.

What could possibly go wrong lol.

Throttlebody

2,348 posts

53 months

Monday 8th June 2020
quotequote all
Welshbeef said:
https://www.telegraph.co.uk/news/2020/06/07/boris-...


Govt looking at £6k scrappage scheme petrol & diesel to purchase EVs (maybe PHEVs).

Now please tell me what 7 seat EV option i have?



Also for those thinking cheap cars will keep selling given this it might mean far more clunkers are far more valuable and push up the dregs of the market.
EVs are low volume sellers, so not much of a help to boost the car industry.

Throttlebody

2,348 posts

53 months

Monday 8th June 2020
quotequote all
German new car registrations in May down 50% on normal levels.

German car showrooms were open all of May post lockdown.

jamoor

14,506 posts

214 months

Monday 8th June 2020
quotequote all
Throttlebody said:
Welshbeef said:
https://www.telegraph.co.uk/news/2020/06/07/boris-...


Govt looking at £6k scrappage scheme petrol & diesel to purchase EVs (maybe PHEVs).

Now please tell me what 7 seat EV option i have?



Also for those thinking cheap cars will keep selling given this it might mean far more clunkers are far more valuable and push up the dregs of the market.
EVs are low volume sellers, so not much of a help to boost the car industry.
I’m pretty sure that’s the point, to make them mainstream using a scrap scheme.

Inky81

282 posts

95 months

Monday 8th June 2020
quotequote all
Throttlebody said:
Welshbeef said:
https://www.telegraph.co.uk/news/2020/06/07/boris-...


Govt looking at £6k scrappage scheme petrol & diesel to purchase EVs (maybe PHEVs).

Now please tell me what 7 seat EV option i have?



Also for those thinking cheap cars will keep selling given this it might mean far more clunkers are far more valuable and push up the dregs of the market.
EVs are low volume sellers, so not much of a help to boost the car industry.
EV's are already heavily subsidised (plug in grant, 0% BIK, 100 WDA). Any more incentives and they'll be paying us to drive them.

Deep Thought

35,724 posts

196 months

Monday 8th June 2020
quotequote all
Inky81 said:
Throttlebody said:
Welshbeef said:
https://www.telegraph.co.uk/news/2020/06/07/boris-...


Govt looking at £6k scrappage scheme petrol & diesel to purchase EVs (maybe PHEVs).

Now please tell me what 7 seat EV option i have?



Also for those thinking cheap cars will keep selling given this it might mean far more clunkers are far more valuable and push up the dregs of the market.
EVs are low volume sellers, so not much of a help to boost the car industry.
EV's are already heavily subsidised (plug in grant, 0% BIK, 100 WDA). Any more incentives and they'll be paying us to drive them.
yes

Especially now theres the likes of the e-Golf and the MINI Cooper-E (or whatever its called). Two very viable cars at the lower end of EV pricing that dont look like noddy cars.



kambites

67,462 posts

220 months

Monday 8th June 2020
quotequote all
If they do offer £6k and keep the current plug-in grant as well, I'll almost certainly end up buying a new family car through the scheme. A budget family car like the MG ZS EV at £21k "cost to change" is hard to justify but at about £15k it becomes be a rather different prospect!

Given the current cheapest ZS EVs on autotrader are up for £20k, it's hard to see how such a scheme couldn't have a significant knock-one effect on used prices.

Edited by kambites on Monday 8th June 16:33

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