Despite signs of a recovery for vehicle manufacturing, Cox Automotive believes the sector is entering a new era of significant change amid shortening lead times, where supply is significantly below normal pre-pandemic levels.
There has been a notable shift in how consumers are accessing vehicles, as well as the types of vehicles that are in demand. While passenger cars will always remain a necessity, higher interest rates and affordability represent important obstacles for the market in 2023. As a result, the sector will likely see a continued preference towards affordable used cars as new vehicles become out of reach for many. Likewise, subscription models haven’t quite taken off, and many still favour a two- or three-year Personal Contract Purchase (PCP). So, although the high demand for used cars has somewhat levelled, it’s a market that remains very safe for now.