New car transaction prices rose by 0.82% in June compared to May according to data released by independent monitor, CarPriceCheck.
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Despite the marginal increase during the month, the headline cost of buying a new car from a UK supplier has fallen by just £36 for an average £12,000 small family model since January 1.
In the opening six months of 2002, consumers have seen transaction prices gradually even out with two months of falling prices balanced by two months of rising prices in sequence. The net result is a fall of a third of 1%.
Strong consumer demand did see June buck the general pricing trend as some franchised dealers looked to maximise returns following a record May and the backdrop of a seasonally quiet trading month.
However, a small handful of manufacturers did deliver wide-ranging price cuts during the month. Volvo responded to a 15.49% fall in sales during May compared to May 2001 by improving discounts by an average of 4.3% on a third of its range. Similarly, Land Rover slashed 2.83% off the popular Freelander model as it sought to reverse its 7.01% fall in sales in the year to date.
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By GlobalDataMG Rover continued to build on its renewed success on the forecourt by reducing transaction prices by an average of 1.94% on 90% of its range during June to leave buyers with a 6.06% saving off list price.
Steve Evans, chief executive of CarPriceCheck, believes the Start of 2002 confirms that prices have reached the lowest manufacturers are willing to allow under current conditions.
“Prices were realigned in late 2000 and the early part of 2001. They then changed tack and began to improve specification as a means of compensation against the price differentials with Europe. We’re now seeing the natural peaks and troughs of a buoyant market and its traditional buying patterns.”
Although transaction prices for EU Imports also rose by 1.53% during June, it’s unlikely to have a negative effect on the growing number of parallel imports being bought by private buyers.
Average discounts still remain more than double those found on UK forecourts – standing at 11.57% compared to 5.15%.
