The Retail Motor Industry Federation (RMI) , the umbrella organisation for franchised dealers (NFDA), independent garages (IGA) and auction houses (NAMA) , has raised doubts on the health of the used car market in the UK.
In the strategic report accompanying accounts filed at Companies House it said values were “precariously high”.
“The used car market has seen unprecedented growth, driven by a lack of availability in the new car market. This means it is very difficult to find good stock at a viable value leading to sale values that are precariously high in what could be a false market.”
The accounts were signed off in June 27 this year. Since then used car supermarket Motorpoint has reported its performance dented by limited stock availability, the fall in EV values and increased finance expense due to higher interest rates.
It has put its expansion roll-out programme on hold with a new focus on cash conservation, increasing margins and lowering its cost base.
Another supermarket business CARZ owned by the Peter Vardy group announced this month it was closing its CARZ used car supermarkets in Dundee and Glasgow.
The dealer group, ranked 31 in the Motor Trader Top 200 Dealer Groups with £560.7m turnover, said the move came about as a result of post-COVID used car supply shortages. Successive years of declining new car sales have impacted used car supplies in the UK.