Dealers have reported signs of a positive start to Q3, following the the -4.1% decline in new car registrations in July.
It was the fifth consecutive month of decline for the sector and the worst July sales performance for seven years.
Cox Automotive’s July Market Insight reported a 40% increase in online activity and 60% improved footfall. Although pressures on margin remained, nearly half the respondents cited that they had remained stable.
Looking ahead, Cox expects an increasing appetite for manufacturers and dealers to embrace e-commerce, to see a growth in the demand for advanced vehicle imagery solutions to drive online buyer confidence and for dealers to invest in PPC advertising to drive sales as consumers turn to online for their next vehicle.
Earlier this week Motor Trader reported that overage stock is on the decline, with 83% of dealer reporting a fall in overage used cars as a result of supply and taxation deals.
The data from Cox Automotive shows that stock has started to return to the wholesale sector, with 43% citing a decline in consumer demand.
Days in stock have also increased by 40%.
UK dealers also experiences strong enquiry levels, although conversions are taking slightly longer despite the plethora of available deals and discounts.
Phillip Nothard, Customer Insight and Strategy Director at Cox, said: “Retailers and manufacturers are preparing for the introduction of RDE on 1 September.
“As a result, we have seen increased levels of tactical registrations by various manufacturers. Retailers are also taking advantage of potential incentives offered by the manufacturers.
“From a used car perspective, increased levels of pre-registration product entering the sector will create additional much-needed volumes in the wholesale market.
“We also anticipate increased fleet disposals, as fleet operators replenish stock fleets.
“Although we could experience unseasonal registration throughout August and September, considering the current headwinds facing the sector, performance and activity remain reasonably healthy.”