Another month of record price growth, powered by fuel anxiety-induced EV popularity

According to the latest results from the Auto Trader Retail Price Index, which is based on daily pricing analysis of circa 900,000 vehicles, price growth during September reached yet another all-time high, posting a 21.4% like-for-like increase.

This beats August’s 17.2% month-on-month increase, which itself was the largest single month of price growth on record.

Such is its confidence in the continued health of the used car market, Auto Trader predicts a total of circa 7.75 million used car sales in 2021, which is significantly higher than other commentators, but is a more accurate reflection of current levels of consumer demand. Price growth has also been affected by ongoing used car supply challenges: according to the Auto Trader Market Insight tool, which is available to use for all retailers, supply was down 5.2% last month when compared to September 2020.

The continued acceleration in prices has, in part, been fuelled by the massive levels of consumer demand in the market, which is reflected in the huge growth in traffic to Auto Trader over recent months. This month saw 65.6 million cross platform visits, a 31% increase on the same period in 2019^[iii]. The amount of consumer time spent on the marketplace held steady at 10 million hours, an increase of 20% on 2019. As a result, overall sales for the full quarter are likely to finish at, or very near, the same high level seen during the Q3 rebound from lockdown in 2020.

As the fuel crisis arose towards the end of September, EVs share of new car advert views soared, hitting a record high of 26.5% on 28^th September. On 1^st September, this was 14.2%, clearly demonstrating the effect of the fuel shortage. This demand was also reflected in leads, with EVs share of new car leads also hitting all-time highs towards the end of September, peaking at 28% on 28^th September versus 10-15% at the start of September.

Commenting on the results, Auto Trader’s director of data and insight, Richard Walker, said: “Used car prices have continued their 18-month trend of posting record-breaking growth. While a mere 6.1% price growth was enough to set records in August 2020, this figure pales in comparison to September 2021’s mammoth 21.4%, currently the highest ever monthly price increase. 

“A large part of this growth has come from growing demand for EV vehicles, which, supercharged by the fuel crisis, is now outpacing supply. The real story only becomes visible when applying a week-by-week analysis. While in the first week of September – i.e. before the fuel crisis – retailers were actually more likely to be cutting the price of their EVs, the increased demand arising from the fuel crisis saw retailers raise EV prices later in the month. On average, £156 was added to EV prices on 28^th September, for example, and prices continued to rise as September came to a close.”

Slight increase in retailers adjusting prices in response to market health
An average of 2,226 retailers made daily price adjustments in September. While this is 254 fewer than the same period in 2019, it is 239 higher than last month. An average of 12,826 vehicles were repriced every day last month, which is 10% lower than 2019. The data also suggests retailers were making different changes to sticker prices. Average price adjustments in September 2021 amounted to an increase of £42, compared to a reduction of £338 in September 2019.

Sue Robinson, Chief Executive of the National Franchised Dealers Association (NFDA), said: “Ongoing supply issues coupled with strong consumer demand have resulted in second-hand and nearly new vehicle transactions continuing to perform well, with prices remaining exceptionally strong. Dealerships have experienced a surge in enquiries for electric vehicles most notably due to the recent petrol shortages and EV demand has risen, with the highest month-on-month increase in EV volume prices. Retailers continue to play a key role in informing their customers and helping them to select the low emission vehicle that best suits them”.

Demand outstripping supply in all categories
Like-for-like prices for both used petrol and diesel cars continued to perform strongly, with the average price of a used petrol car increasing 21.7% YoY last month (up from 16.9% in August) and used diesels increasing 22.7% (up from 18.7%). Average sticker prices were £14,793 and £16,082 respectively.

EV volume brands saw significant price growth, rising from 13.2% in August to 18.2% (£24,720). Of all fuel types, this was the highest month-on-month increase in like-for-like prices last month. Used premium EV brand like-for-like prices remain negative YoY, but also saw a positive monthly movement, from -5.5% to -5.0% (£46,358).

The reason for this disparity is due to supply and demand: YoY demand continues to outstrip levels of supply in the EV volume market (135.2% vs 31.7% respectively) leading to positive price growth.

For EV premiums, where YoY supply has tended to outstrip YoY demand, supply is beginning to be outpaced by demand for the first time since February 2020 – no doubt caused by the ongoing fuel shortage crisis. Looking by week, there was a continuous increase in demand throughout the month of September, which rose to 106.3% YoY in the week commencing 20^th September (i.e., the final full week of September). For the week commencing 27^th September (which includes 1-3^rd Oct), YoY demand grew further to 152% YoY.

Top 10 price growth | September 2021
Rank	Make	Model	Average Asking Price	Price Change
1	Jaguar	XK	£28,196	52.0%
2	Hyundai	i30	£12,051	38.0%
3	Mazda	MX-5	£13,544	34.1%
4	Mitsubishi	Shogun	£17,876	33.7%
5	Audi	RS3	£40,443	33.5%
6	Jeep	Grand Cherokee	£21,360	33.3%
7	Jaguar	XKR	£27,059	31.8%
8	Ford	Focus	£12,727	31.6%
9	Kia	Sorento	£19,105	31.1%
10	Citroen	Grand C4 SpaceTourer	£22,203	30.8%
Top 10 price contraction | September 2021
Rank	Make	Model	Average Asking Price	Price Change
10	Audi	S4 Avant	£30,940	-16.2%
9	Audi	e-tron	£62,805	-7.2%
8	Fiat	Punto Evo	£2,434	-6.6%
7	Citroen	DS4	£5,390	-5.9%
6	Bentley	Bentayga	£112,963	-3.0%
5	Jaguar	X-Type	£3,522	-2.7%
4	BMW	i3	£23,818	-2.6%
3	Citroen	DS3 Cabrio	£5,899	-2.1%
2	Jaguar	I-PACE	£57,213	-2.1%
1	Citroen	DS3	£4,872	-2.0%

 

i Volume EV brands categorised as: Ford, Volkswagen, Vauxhall, Peugeot, Nissan, Citroen, Kia, Hyundai, MG, Renault, SEAT, SKODA, Honda, Toyota, Fiat, Suzuki, Mazda, Mitsubishi, Smart, Dacia, Jeep, Subaru

ii Premium EV brands categorised as: Audi, BMW, Mercedes-Benz, Land Rover, Jaguar, Tesla, Volvo, MINI, DS AUTOMOBILES, Lexus, Abarth, Alfa Romeo

iii Given the exceptional operating environment over the past 18 months, our marketplace traffic over the comparable period in 2019 provides a more meaningful overview of its performance than a comparison with 2020

About the Retail Price Index
The Auto Trader Retail Price Index is published monthly and provides an overview of the latest price and search data from our marketplace. Our team of data scientists monitor hundreds of thousands of vehicles each day, including 90,000 vehicle updates and an average of 19,000 vehicles added or removed from Auto Trader. Coupled with data from circa 450,000 trade car listings every day, as well as additional retailer forecourts and website data (OEM, fleet and leasing disposal prices and pricing data from over 3,000 car dealership websites and data from major auction houses across the UK), ensuring the Index is an accurate reflection of the live retail market.

As of March 2020, the methodology for the Auto Trader Retail Price Index was adapted based on re-segmentation of our data. We have regrouped car segments into more meaningful classifications of the different types of vehicles that consumers buy, from an even greater depth of data than before. As we now have a more detailed dataset, we have restated figures for prior periods to reflect the change in methodology.

About Auto Trader
Auto Trader Group plc is the UK and Ireland’s largest automotive marketplace. Our marketplace sits at the heart of the car buying process, with the largest number of buyers and the biggest choice of trusted stock. Auto Trader exists to change how the UK shops for cars by providing the best online car buying experience and enabling all retailers to sell online. We are building stronger partnerships with our customers, using our voice and influence to drive more environmentally friendly vehicle choices and creating an inclusive and diverse culture for all of our people. Auto Trader listed on the London Stock Exchange in March 2015 and is a member of the FTSE 100 Index.

For more information, please visit https://plc.autotrader.co.uk/who-we-are/about-us/