UK new car supply should improve over the next 12 months according to Shoreham Vehicle Auctions’ MD Alex Wright.
This will be because of OEMs’ response to the growing number of Chinese brands launching in the UK.
Wright said that OEMS risk losing valuable sales and market share if they do not increase their production capacity as brands like MG offer value for money petrol and EVs cars in dealer stock or with minimal delivery delays.
MG reported a 66.8% sales increase in the UK in 2022 to 51,050 cars, more than established brands such as Skoda, Citroen, and Honda and just 1,200 cars behind Peugeot.
“OEMS will have to decide whether they want to protect their market share and compete with the new Chinese brands that have a very strong proposition and product availability,” said Wright.
“When supply improves it will reignite new car sales as well as ease the pressure on the used market.
“Currently, consumers have the option of buying a brand new fully warranted new car on competitive finance or a three-to-four-year-old used car for the same price outside the manufacturer’s warranty. It reminds me of when Daewoo launched in the UK and its new prices were more in tune with used cars.
“OEMs have increased new car prices to help get round this anomaly, but due to inflation used prices are likely to remain high for the foreseeable future. The same type of used cars we sold at auction in 2018 for £9,000 are now selling for £18,000 which gives you some idea of how the market has moved in recent years.”