Used car prices increased 2.9% on the month to September 2021, leading to a cumulative increase of 21.8% since April 2021 – Office for National Statistics (ONS)
Diesel costs hit a record high of 147.94p per litre, on November 1st, just a week after petrol hit a new peak of 144.35p per litre – RAC and AA Data
Energy prices are expected to keep rising for the next 18 months (Scottish Power)
All of these are feeding into inflationary pressures that, according to the Bank of England’s new chief economist, could exceed 5 per cent early next year. Such a figure could see inflation overtake the ONS’ expectation for the underlying growth in real average wages.
Rising costs are likely to see potential buyers looking towards used cars and, indeed, lower-priced used cars than they may have anticipated. In a challenging used car stocking purchasing environment, recognising the consumer impact of an upward inflationary trend not seen for many years and the potential it brings for rising interest rates is something dealers should consider in their stocking mix as MotoNovo Finance MD Karl Werner reflects; “Typically, consumers have a clear idea of their budget when it comes to purchasing a used car; however, rising inflation is set to impact their budgeting processes in a manner many may not have experienced. An adjustment to a dealer’s stocking mix, which has to an extent already been forced by stock shortages, and the use of finance to illustrate monthly costs to car buyers are steps dealers can take now to meet the needs of consumers for a car they can afford.”