Will Coronavirus hit used car prices?

Will Coronavirus hit used car prices?

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Vroomer

Original Poster:

1,477 posts

134 months

Friday 27th March
quotequote all
gizlaroc said:
Vroomer said:
Interesting statistic:

At around 10.00am today their were 531k cars listed on Autotrader.

At around 2.30pm today there were 532k cars listed on Autotrader.

So that's an increase of 1,000 cars in just over 4 hours at a time when people aren't meant't to be making inessential journeys.

What do you make of that?
I would guess that with dealerships closed and online sales only allowed we should see the numbers on autotrader grow like mad.
Many main dealers don't put all their stock on autotrader.
BMW often have dozens of a certain model on their AUC site that are not listed on Autotrader.
I bet now they are throwing money at the online side far more.
Up again to 534k cars today. Presumably indicates nothing selling and more cars be added in desperation.

Going out to look at cars (or collect if bought online) is not one of the Government's reasons for leaving home.

Fezzaman

514 posts

147 months

Friday 27th March
quotequote all
crosseyedlion said:
Fezzaman said:
crosseyedlion said:
On the flip side, consider all the money that is having to be (Virtually) printed to pay for all this, and thats before we can start to get back to normal in 3-6 months time (hopefully) and they will need another big cash injection to stimulate the economy (at present we are just maintaining, not stimulating)...we are very likely to see monumental levels of inflation in the next 12-24 months. Conservatively I would expect £1 in the bank now to be worth 70p in 12 months time.

The values of 'stuff' will climb to compensate, although I would expect discretionary purchases such as anything but the most basic transport to be in much lower demand, that and many self employed/directors have been royally screwed - so prices effectively haemorrhaging for the forseeable.
You're on to something here... there's a difference between 'prices' and 'values'. Over the last decade (and seems like going forwards as well given extent of proposed govt support) price of something becomes increasingly irrelevant and the relative value of it becomes more important.
I would be looking to put any money sat in the bank into 'things' as soon as restrictions are lifted.
Exactly.

Those with cash savings to weather this storm will find their reserves worth less. So embrace the 'YOLO' life and buy that toy and enjoy it or invest it in the stock market because your bank sure as hell isn't paying you enough interest to keep up with inflation to help you put it towards a deposit on escalating house prices (for FTBs) or funding retirement costs (or any other future obligations for the older/baby boomer generation). The shrewd folk have done precisely this (often a combination of both).

Sure there will be people running successful, profitable businesses that will feel a squeeze (possible understatement of the year), but that's life and the risks that come with it. But there are also plenty of 'employee' people on normal salaries that have not seen any wage inflation (net after income tax/NI etc) that have been saving and see the futility of their attitude so they will welcome a 'price' correction - be that house prices or a car - as an opportunity to finally buy. It's like going to the reduced aisle in a supermarket - the goods there are still the same and have the same 'utility' or 'value' to the buyer. The seller just needs shot of it.

On the flip side, those that were born into this cheap debt environment and treat everything as a monthly payment living paycheck to paycheck are in for a serious shock if their jobs aren't secure...

gizlaroc

14,691 posts

178 months

Friday 27th March
quotequote all
Vroomer said:
Up again to 534k cars today. Presumably indicates nothing selling and more cars be added in desperation.

Going out to look at cars (or collect if bought online) is not one of the Government's reasons for leaving home.
Of course.

Interesting to look at private sales too. They often account to 25% or so of sales.

CJ1

344 posts

32 months

Friday 27th March
quotequote all
I was looking to swap my 2015 Golf R for a slightly older M135i, my cars worth around £14250 according to WBAC 2 weeks ago. Was looking at a 2013 M135i listed at a BMW dealer for £15000.

Contacted them for a part ex valuation. Was offered £12500. They’re Inchcape group so they wanted to use mine as stock at their VW dealership and would probably list it for £16000.

I understand it’s not the time to be selling cars. But surely dealers are going to have to re adjust their prices?

The BMW salesman said “sorry mate it’s not the right time to be selling a car”, so I replied “well surely you as a dealer aren’t going to be selling any cars either so we can come to a deal? Il if my cars lost £2000 in 2 weeks il offer you £13000 your £15000 car?

BMW Saleman “nah mate we’re selling loads of cars at the moment. It’s just the Part Ex price that’s gone down”!!!

Hoping they’ll call me back when they open in 2 weeks again and we can come to a deal... but by the looks of it it’s just us that are going to suffer.




06andiano

43 posts

19 months

Friday 27th March
quotequote all
CJ1 said:
I was looking to swap my 2015 Golf R for a slightly older M135i, my cars worth around £14250 according to WBAC 2 weeks ago. Was looking at a 2013 M135i listed at a BMW dealer for £15000.

Contacted them for a part ex valuation. Was offered £12500. They’re Inchcape group so they wanted to use mine as stock at their VW dealership and would probably list it for £16000.

I understand it’s not the time to be selling cars. But surely dealers are going to have to re adjust their prices?

The BMW salesman said “sorry mate it’s not the right time to be selling a car”, so I replied “well surely you as a dealer aren’t going to be selling any cars either so we can come to a deal? Il if my cars lost £2000 in 2 weeks il offer you £13000 your £15000 car?

BMW Saleman “nah mate we’re selling loads of cars at the moment. It’s just the Part Ex price that’s gone down”!!!

Hoping they’ll call me back when they open in 2 weeks again and we can come to a deal... but by the looks of it it’s just us that are going to suffer.
Penny will drop with them eventually, they just aren't willing to accept it yet.

Deep Thought

26,273 posts

151 months

Friday 27th March
quotequote all
CJ1 said:
I was looking to swap my 2015 Golf R for a slightly older M135i, my cars worth around £14250 according to WBAC 2 weeks ago. Was looking at a 2013 M135i listed at a BMW dealer for £15000.

Contacted them for a part ex valuation. Was offered £12500. They’re Inchcape group so they wanted to use mine as stock at their VW dealership and would probably list it for £16000.

I understand it’s not the time to be selling cars. But surely dealers are going to have to re adjust their prices?

The BMW salesman said “sorry mate it’s not the right time to be selling a car”, so I replied “well surely you as a dealer aren’t going to be selling any cars either so we can come to a deal? Il if my cars lost £2000 in 2 weeks il offer you £13000 your £15000 car?

BMW Saleman “nah mate we’re selling loads of cars at the moment. It’s just the Part Ex price that’s gone down”!!!

Hoping they’ll call me back when they open in 2 weeks again and we can come to a deal... but by the looks of it it’s just us that are going to suffer.
Other than the blase attitude of the salesman, they're handling it as i would expect them to - they're not feeling any urge to discount their car currently (probably based on time in stock), however they're valuing your car based on what they expect to be able to retail it at next month.

Not an unreasonable business approach - particularly given they've had interest in the car at its current price - you plus maybe others?

Dolf Stoppard

837 posts

76 months

Friday 27th March
quotequote all
06andiano said:
CJ1 said:
I was looking to swap my 2015 Golf R for a slightly older M135i, my cars worth around £14250 according to WBAC 2 weeks ago. Was looking at a 2013 M135i listed at a BMW dealer for £15000.

Contacted them for a part ex valuation. Was offered £12500. They’re Inchcape group so they wanted to use mine as stock at their VW dealership and would probably list it for £16000.

I understand it’s not the time to be selling cars. But surely dealers are going to have to re adjust their prices?

The BMW salesman said “sorry mate it’s not the right time to be selling a car”, so I replied “well surely you as a dealer aren’t going to be selling any cars either so we can come to a deal? Il if my cars lost £2000 in 2 weeks il offer you £13000 your £15000 car?

BMW Saleman “nah mate we’re selling loads of cars at the moment. It’s just the Part Ex price that’s gone down”!!!

Hoping they’ll call me back when they open in 2 weeks again and we can come to a deal... but by the looks of it it’s just us that are going to suffer.
Penny will drop with them eventually, they just aren't willing to accept it yet.
Yep. As we get back to normal dealers will need to drop their prices. Or, the market will go back to where it was, and the price to change will be the same. Or there will be a small corresponding adjustment.

People won't have more money, or be willing to pay a higher cost to change just because of what's happened. The market will have to address this or cars won't shift.

I suspect it's probably going to be the latter two options that are the most likely, with lots of incentives from manufacturers on new vehicles. They're obviously going to want to do all they can to make up for missed sales.

People need to stop panicking over the current WBAC prices. Well, if there were any...

321boost

800 posts

24 months

Friday 27th March
quotequote all
Condi said:
There seems to be some perverse thrill on here about prices coming down, either from those who want to buy something fun at silly cheap money, or those who are taking pleasure from someone else's expensive car now being worth less.

Chances are that used car prices will not move that far. This isn't 2008, people on the whole haven't run out of cash, they're just not spending it now.
Or you’re just scared that your car will be worth less.

Ferodocastrol

4,503 posts

179 months

Friday 27th March
quotequote all
321boost said:
Condi said:
There seems to be some perverse thrill on here about prices coming down, either from those who want to buy something fun at silly cheap money, or those who are taking pleasure from someone else's expensive car now being worth less.

Chances are that used car prices will not move that far. This isn't 2008, people on the whole haven't run out of cash, they're just not spending it now.
Or you’re just scared that your car will be worth less.
I agree with both of you.

V8RX7

19,813 posts

217 months

Friday 27th March
quotequote all
av185 said:
V8RX7 said:
Being able to buy a new car, keep it a year and get all your money back, which has been possible with many desirable BMW Porsche etc models for the last five years is not a normal occurrence either.
Not sure what you mean by 'normal'.

It is simply the established market forces of supply and demand at work. Together with masterly marketing.

Porsche deliberately underprice their halo cars when new and restrict manufacturing numbers both in the name of branding which hugely drives sales of vanilla models and maintains high residuals.
I'm unsure what else you think "normal" can mean

I know several people who have managed to buy cars from Main Dealers and a year later, get all of their money back in allowance against a new model - that is not normal - ie it is unusual, yet it has been the norm for the last 5 or so years with various models, one mate even managed to get a better monthly deal on a new Kuga than he had on his current one - ie get a new car and pay less !



GT3Manthey

249 posts

3 months

Friday 27th March
quotequote all
Ferodocastrol said:
I agree with both of you.
Its the same on other forums with talking down prices and I just don't get it. If you want a car and now feel you can haggle then get involved.

I for one WONT be selling my cars unless I want to trade up or fancy a switch around which invariable involves added cash !

Rick1.8t

655 posts

133 months

Friday 27th March
quotequote all
CJ1 said:
Hoping they’ll call me back when they open in 2 weeks again and we can come to a deal... but by the looks of it it’s just us that are going to suffer.
2 weeks? Let’s be realistic, the govt doesn’t fling money at people for 3 months for no reason - see how he feels in 6 weeks more likely, may be a completely different story by then (for both of you unfortunately)

loskie

1,852 posts

74 months

Friday 27th March
quotequote all
Rick1.8t said:
CJ1 said:
Hoping they’ll call me back when they open in 2 weeks again and we can come to a deal... but by the looks of it it’s just us that are going to suffer.
2 weeks? Let’s be realistic, the govt doesn’t fling money at people for 3 months for no reason - see how he feels in 6 weeks more likely, may be a completely different story by then (for both of you unfortunately)
No get real. It will be 12 weeks.likely more. Drip fed in 3 week stints so the populous doesn't get too scunnered


Aaa.

3,450 posts

52 months

Friday 27th March
quotequote all
I'm seeing what I would call desperation from dealers. Not necessarily prices, but to gain buyers. I've seen at least 3 offer an arrangement of pay in full now and we'll store you car until this lockdown is finished.

Hmmm, that might work if you yourself were desperate and the car was as rare as hens teeth, but for normal stuff I can't see the upside of it. Not to mention not seeing or driving the car in person and giving a dealer that may be bust in a few weeks several thousand pounds.

av185

11,009 posts

81 months

Friday 27th March
quotequote all
V8RX7 said:
av185 said:
V8RX7 said:
Being able to buy a new car, keep it a year and get all your money back, which has been possible with many desirable BMW Porsche etc models for the last five years is not a normal occurrence either.
Not sure what you mean by 'normal'.

It is simply the established market forces of supply and demand at work. Together with masterly marketing.

Porsche deliberately underprice their halo cars when new and restrict manufacturing numbers both in the name of branding which hugely drives sales of vanilla models and maintains high residuals.
I'm unsure what else you think "normal" can mean

I know several people who have managed to buy cars from Main Dealers and a year later, get all of their money back in allowance against a new model - that is not normal - ie it is unusual, yet it has been the norm for the last 5 or so years with various models, one mate even managed to get a better monthly deal on a new Kuga than he had on his current one - ie get a new car and pay less !
But presumably the example of your mates Kuga is merely finance or pcp the latter of which as we all know for various reasons can be manufacturer subsidised whatever and deals vary hugely depending on incentives at the time some good some bad some horrendous.

Don't forget that dependent on make and model a new car can actually be cheaper to buy outright than a lightly used one and this particularly invariably applies when it comes to pcp.

Also black market premiums are nothing new I ordered a new Estoril blue e46 M3 in 2003 from Bowker BMW Preston because even trade prices ££ used were at the time above list even for cars with 10k miles.

More recent examples include the original Evoque.

Porsche are an interesting one. Even the revered 997 GT3 RS 4.0 of which only 28 UK examples were ever made didn't make huge premiums at the time even though these cars can now retail up to £400k on the back of demand for smaller and more analogue cars. The standard 997 GT3 and all 911s actually depreciated similar to other similar priced cars at the time.

In terms of latter day cars it was the 991.1 GT3 in late 2013 that really introduced the black market despite 336 UK cars most of which had replacement engines and production was delayed as a consequence, mine included. Despite this initially flipped cars costing £110k otr sold for £180k and still retail up to £100k 25k miles some 6 years later. Subsequently the 981 GT4 Spyder and of course the 991.2 GT3 GT2 RS and GT3 RS benefit from varying premiums and still largely do although these are clearly under pressure in the current situation despite the right cars still selling well.

The crucial three main factors are of course timing, to an extent the prevailing economic backdrop and as I already said, supply and demand.

R.Sole

10,996 posts

160 months

Friday 27th March
quotequote all
Anyone that thinks that this crisis is not going to change things going forward (for the worse) is either kidding themselves or has not quite grasped the seriousness of this sh£tstorm!
Used car prices will be one of the least of everyone’s worries!

Deep Thought

26,273 posts

151 months

Friday 27th March
quotequote all
R.Sole said:
Anyone that thinks that this crisis is not going to change things going forward (for the worse) is either kidding themselves or has not quite grasped the seriousness of this sh£tstorm!
Used car prices will be one of the least of everyone’s worries!
Who said it wasnt going to change things?

gizlaroc

14,691 posts

178 months

Friday 27th March
quotequote all
CJ1 said:
Hoping they’ll call me back when they open in 2 weeks again..........
When have you got to pay them?

I reckon you are looking at more like 12-16 weeks and by then you might want to consider renegotiating.

R.Sole

10,996 posts

160 months

Friday 27th March
quotequote all
Deep Thought said:
Who said it wasnt going to change things?
AV185 seems to think prices will go up or at least stay the same or he would not be buying stock.