Vertu Motors has expressed optimism over the recovery of used car sales as prices stabilise, but warned that incoming zero-emission regulations could cause further market disruption. The car dealership, which operates 189 sales and aftersales sites, reported a 6.7 percent increase in like-for-like used car sales by volume in its first quarter to May 31.
New car and motability vehicle sales also saw a comparable rise of 6.8 percent in the same quarter. Vertu noted a greater stability in used car prices, following a 10.3 percent drop in the final quarter of 2023 after significant increases in previous years.
Demand has bounced back since the beginning of this year, with Vertu observing that prices have returned to “more normalised seasonal trends”. However, the company cautioned that stringent targets for car manufacturers to meet specific zero emissions vehicle (ZEV) sales could introduce volatility into the market and potentially drive up prices for new and used vehicles.
The firm stated: “The Zero Emission Mandate to force the uptake of zero emission vehicles sold in the UK has the potential to create volatility in the new car market.”
It added: “This may include reduced supply of new petrol and diesel cars in the coming periods and would lead to a strengthening of petrol and diesel used car values.”
Last year, Prime Minister Rishi Sunak postponed the ban on the sale of new petrol and diesel cars in the UK from 2030 to 2035.
However, the Government has confirmed that it will continue to set targets for car manufacturers to meet Zero Emission Vehicle (ZEV) sales.
According to these targets, more than a fifth (22 percent) of new cars sold by manufacturers in the UK next year must be zero emission, with this figure increasing to 80 percent by 2030.
In its most recent update, the AIM-listed company stated that it is still on track to meet its full-year guidance.
This follows results released in May which showed revenue at the dealership increased to £4.7 billion in the year to February 29, up from £4 billion the previous year, contributing to a 6.5 percent rise in pre-tax profits to £34.6 million.
