Legislation impacts on used market

Around £2,000 could become the new entry point into the used car market for many dealers thanks to the Consumer Rights Act, according to the RAC.

The motoring organisation suggests that it is simply very difficult to sell a car that meets all legal requirements at much below this level.

Sean Kent, director, corporate and independent dealers, explained, ‘We are not saying that all cars priced below £2,000 are of poor quality or that dealers operating in that sector are not operating with customer interests at heart.

‘But what we are hearing increasingly from independent dealers is that the cost of acquiring a car and selling it to the standards required by the Consumer Rights Act is difficult to achieve for much below this figure.

‘It is not a hard and fast rule but it is definitely a trend that we are increasingly seeing across the market and chimes with other recent reports that small franchise dealers have abandoned the sub-£1,500 sector.

‘In effect, the Consumer Rights Act is causing a shift in this sector, meaning many dealers are choosing to move into a slightly higher price bracket and changing their proposition.’

Currently there are 250 RAC Approved Network dealers with plans in place to extend this to 350 by the end of the year.