The coronavirus crisis affected every business in the UK including the vehicle market. The dealerships were closed for months, but in June they were allowed to open again. Even though it has just been over a month since the dealerships have opened, and it’s too early to report the market growth, we can see that it’s improving.
The question that arises here is, whether the dealers are actually selling vehicles or not. The answer is yes, they are but the sales are not as much as you expect them to be. The surprising thing here is that the used and fairly new car market is doing a lot better than the new car market. It’s because the stock is available and the consumers don’t have to wait to get the car. The new car market is dependent on when the factories would reopen and how fast they manufacture vehicles while following the necessary protocols.
Allowing dealerships to open has helped the car industry who was suffering a lot due to crisis. The sales have been very good throughout the month. Still, there are concerns regarding the numbers of the new car registrations. The process, of course, has been slowed by the stock limitations.
The available data suggest that there is a steady interest among consumers. The data is taken from the poll in which 6,000 potential buyers take part every week. You would expect the companies to give discounts to customers, to boost sales, especially in this post-lockdown situation. But, the discount-situation is not clear yet, maybe because the demand is high, and most companies provide discounts only when demands lower.
The prices of used cars have not decreased as well. Simply because the demand is high and supply is low. Customers are eager to purchase a car, even at a slightly higher price to avoid public transport. The dealers have got some comfort from this situation. The data shows that some cars have seen an increase of 20% in their prices since March.
Another interesting thing to mention here is the intent of the people has shifted. A lot of consumers have changed the car that they want to buy during the lockdown. It’s very early to say whether or not the companies have realized this, but it’s important to consider.
About a month ago, there were speculations that some sort of scrappage scheme would be introduced and even some details were leaked. But later, the authorities said they don’t have any plans to introduce such a scheme.