Monthly Market Update: Used car residual values slump further in Europe during November
03 December 2024
Residual values (RVs) expressed as a percentage of new-car list price (%RV) continued to decline across major European used-car markets in November. Autovista Group experts review the latest data with Autovista24 journalist Tom Hooker.
November saw %RVs slump across major used-car markets in Europe. The average value retained by a three-year-old car at 60,000km suffered significant year-on-year declines in Austria, France, Germany, Italy, Spain, Switzerland and the UK.
Four markets endured their poorest %RV performance of the year so far. A further two regions recorded their second-worst %RV result of 2024. This led to some markets adjusting their full-year RV outlook downwards.
Percentage RV slumps
The two biggest %RV drops were seen in Austria and the UK. The former posted an %RV of 47.7% in November. This was its lowest level of 2024 so far, and fell 6.2 percentage points (pp) below values recorded one year ago. It also dropped 2.3pp compared to its October result, the largest %RV month-on-month decline of the seven markets.
At the start of the year, three-year-old cars in Austria held a %RV of 53%, which remains its best performance of 2024. This was 5.3pp higher than November’s figure.
The UK saw a better %RV of 51.1% last month. However, this was 6.2pp behind its result from 12 months ago, and 0.5pp lower than in October. Furthermore, it marked the country’s second-lowest %RV level after July, and was a significant distance behind its 53.3% performance in January.
Meanwhile, Germany witnessed values of 36-month-old cars decline 5.8pp year on year to 50%. However, it did improve %RV by 0.1pp compared to the last report. Despite the marginal gain, this is still some distance from its %RV level of 51.6% recorded in January.
Values reach new low
Italy also experienced a strong %RV decline, with values slumping 3.7pp year on year to 49.4%. This was 0.9pp behind its October figure, and while not as severe a drop as others, it marked the country’s worst performance so far in 2024.
At the start of the year, %RVs reached 55% in the country, 5.6pp behind its latest result. Out of all seven markets, this was the biggest gap between a January and November figure.
In Switzerland, values dropped from 47% in October to 46.8% in November. This was the lowest %RV level out of the European markets covered. It was also 3.1pp behind its performance from 12 months ago. The country started the year with a %RV of 49%, which remains its highest result so far.
Spain had the smallest year-on-year %RV decline out of the seven markets. In November, 36-month-old cars held onto 58.9% of their value on average, down 2.3pp from the same period in 2023. This was the highest %RV level of any major European used-car market in the month.
The figure was just ahead of the 58.8% average recorded in October, the lowest so far this year. %RVs in Spain sat at 60.2% at the start of 2024, 1.3pp ahead of the latest result. Out of the seven markets, this was the smallest margin between January and November values.
%RVs dropped slightly in France compared to October, with three-year-old cars retaining 53.9% of their value, down 0.3pp. However, this marked its lowest %RV level of 2024 so far, 3.7pp below its peak in February.
Increasing demand in Austria
‘Following a drop in the last three consecutive months, the sales-volume index (SVI) in Austria increased in November. The number of observed sales increased by 4.7% from October. Compared to 12 months ago, SVI was 10.8% higher,’ explained Robert Madas Eurotax regional head of valuations, Austria, Switzerland, and Poland.
Meanwhile, the active market volume index (AMVI) of two-to-four-year-old passenger cars decreased by 2.1% compared to October. This means that the supply volume of passenger cars in this age bracket slumped by 9.7% compared to the previous year.
At 68.5 days, the average amount of time needed to sell a used car increased in November. This was over two days longer than October.
Diesel vehicles continued to be the fastest-selling powertrain, averaging 61.5 days last month. This was followed by plug-in hybrids (PHEVs) at 64.9 days, petrol vehicles at 71.3 days and battery-electric vehicles (BEVs) at 81.4 days. Full hybrids (HEVs) took the longest amount of time to sell at 92.1 days.
Declining percentage RVs
‘%RVs sat at 47.7% on average in November. This was a 2.3pp decrease compared to the previous month. This was caused by market adjustments due to longer selling times and increased discounting,’ commented Madas.
HEVs retained the greatest amount of trade value in the month at 51.6%, followed by petrol cars (50%). Then came diesel models (47.6%) and PHEVs (44.6%). BEVs again retained the lowest amount of value, at 41.6%.
%RVs are expected to stabilise until the end of the year, resulting in a year-on-year drop of 9.5% in 2024. Further pressure on values can be expected, due to weakening demand and unwavering supply. %RVs are expected to decrease at a steadier pace in 2025 and 2026.
Values stabilise in France
‘In France, RVs continued to stabilise during November across almost all powertrains. Compared to October, RVs increased last month due to higher list prices. This impacted %RVs which recorded a lower year-on-year decrease than expected,’ outlined Ludovic Percier, Autovista Group residual value and market analyst for France.
The %RVs of petrol, diesel and PHEV used cars remained stable in November. Diesel was the quickest powertrain to sell at 52.1 days on average. This is because offers are decreasing in the used-car market due to lower sales in the new-car market. Yet, demand for diesel is still consistent in the used car market.
At 78.2 days, PHEVs took a long time to sell on average. However, this was an improvement of 5.6 days compared to the previous month. Petrol cars took an average of 64.5 days to sell in November.
Hybrid positivity
‘HEV %RVs increased by 0.1pp in November after months of stabilisation. The technology is currently the best compromise between full internal-combustion engines and BEVs, with no need to plug the car in. Furthermore, some small HEV models are becoming more affordable,’ highlighted Percier.
Meanwhile, BEVs suffered a slight %RV decrease of 0.1pp this month. All-electric vehicles took 97.1 days to sell on average in November, the most of any powertrain.
As of December 2023, electric car purchase incentives became dependent on lifetime carbon emissions, removing the eligibility of some brands and models, especially those built in China.
Therefore, used models are still too expensive, causing prices to drop month after month. Where demand does not meet supply, the market sees a strong RV drop and lower prices.
Decreasing demand in Germany
Following a slight decrease in October, the SVI showed a larger decline in November. Compared to the previous month, this metric was down 4%. It was also a 14.7% decrease year-on-year.
Meanwhile, the AMVI of two-to-four-year-old passenger cars decreased by 5.4% compared to October. The supply volume of passenger cars in this age bracket dropped by 27.6% compared to the previous year.
‘The average number of days needed to sell a used-car increased to 60.1 days in November. Diesel and PHEV-powered models sold the fastest at 56.1 days and 56.3 days respectively,’ said Madas.
BEVs took an average of 61 days to sell, which was 4.3 days faster than the previous month. They were followed by HEVs after 62 days, and petrol cars after 63.5 days.
Growing pressure on RVs
‘Despite weak demand, the RV of a 36-month-old car at 60,000km remained stable with a slightly positive trend. Models held an average %RV of 50%, a 0.1pp improvement on October. This equated to a considerable decline of 5.8pp year-on-year, showing that pressure on RVs is increasing,’ Madas noted.
HEVs led the market with a %RV of 52.6%. Then came petrol cars at 52.0%, diesel models at 50.6% and PHEVs at 45.4%. BEVs retained the lowest level of value at 38.5%.
As demand weakens and supply persists, RVs can be expected to come under even more pressure in Germany. This year, %RVs are expected to fall further, dropping by around 7.5% when compared with December 2023.
In 2025, %RVs are also forecast to decrease, down 2.6% on average. Pressure will likely ease in 2026, and RVs will show a declining trend of 1.4%.
Values falling further in Italy
Used-car values continued their decline in November. This was at a pace slightly below expectations, meaning the RV outlook for 2024 now forecasts a fall of 7% year on year, down from a 6.6% drop in the previous report.
‘The most significant correction was made for compressed natural gas (CNG) engines. Until October, values for the powertrain were expected to grow compared to 2023. Now CNG engines are forecast to remain stable in 2024,’ stated Marco Pasquetti, head of valuations, Autovista Group Italy.
The trend of BEV RVs, on the other hand, continues to be very negative. Compared to 12 months ago, %RVs fell by 13.4% in November.
The technology recorded an average transaction price of €13,789 last month, over €1,500 less than the €15,355 posted one year ago. The situation is no better for PHEVs, which saw %RVs drop by 12.6%.
The Italian government has recently announced that its incentive scheme will be discontinued in the coming years. Because of this, slightly less pressure on used car values is expected.
‘However, it should also be noted that this decision will almost certainly slow down the transition to EVs in the Italian market. We believe that this decline will continue in the coming years. It may also have consequences on investment in infrastructure development,’ commented Pasquetti.
EVs stagnating in Spain
As in previous months, the new car market in Spain is growing very slowly. In October, registrations increased by 7.2% compared to 2023. In the first 10 months of the year, new-car registrations have improved by around 5% year on year.
In November, the private and company sectors generated delivery growth. This follows several intense months for the rental sector, which has accumulated an increase of more than 30% in 2024 so far.
This year’s new-car market continues to be dominated by HEVs. This has made Toyota the market leader, with a significant gap to the rest. The technology accounted for nearly 38% of registrations between January and October.
Meanwhile, registrations of BEVs and PHEVs are once again stagnating, despite gaining some momentum during October. Neither managed to reach a 6% share in the year to date.
‘Spain is still far from the average of the other major European markets,’ highlighted Ana Azofra, Autovista Group head of valuations and insights, Spain.
‘It will only exceed the 10% share of electrified vehicles if there is a commercial effort to encourage demand and at least remove the price barrier. The latter is very likely to happen in the last quarter of the year,’ Azofra added.
Rising price pressure
The used-car market is a little livelier, with a 15% growth in October and a 9% increase for the year. In particular, sales of pre-owned vehicles are growing. This is very positive for the sector in terms of turnover in the hands of professionals. However, this increases the price pressure on these younger used vehicles.
Alongside this rejuvenation of used-vehicle supply and its expected positive effect on the quality of the fleet, the entry of more sustainable cars is increasing.
‘BEVs enjoyed an AMVI improvement of just under 71% in November, while PHEV supply grew by 114%. These figures improve the performance of EVs in the new-car market, where price remains a decisive barrier,’ said Azofra.
The %RVs of these vehicles are falling slightly, but this trend is more stable compared to other countries. Stock accumulation needs to be monitored.
In general, prices of all engines continued to adjust marginally downwards. The average price of a three-year-old 60,000km used car stood at just under €19,069 in November. This is €5 lower than October’s report, but €500 lower than one year ago.
Two MG models, the ZS and HS, were the fastest-selling used cars in November, followed by the DS4.
Falling stock in Switzerland
‘Used-car supply had effectively returned to the pre-COVID-19 level in Switzerland, but incoming stock is now slightly falling once again,’ explained Hans-Peter Annen, head of valuations and insights, at Eurotax Switzerland.
‘Rising living costs have come down slightly this year compared to 2023. However, new-car registrations remain weak, unable to bounce back,’ he added.
The AMVI for two-to-four-year-old passenger cars decreased by 1.1% from October to November 2024. Compared to 12 months ago, this indicator slumped by 9%. This illustrates how the supply of younger used models has not recovered.
In contrast to October’s decrease, the SVI increased by 3.1% last month. Compared year-on-year, it was also slightly up for the first time in months, by 0.9%.
Influenced by constant overall supply and declining demand, RVs of 36-month-old cars at 60,000km decreased again. %RVs slightly fell to 46.8% in November from 47% in October. However, the year-on-year drop was more severe, as the %RV level sat 3.1pp below the values recorded 12 months ago.
Hybrids on top
HEVs retained the most value in November with a %RV of 51.1%. Then came petrol cars (47.9%), diesel models (45.6%) and PHEVs with 44.2%. BEVs were again the worst-performing powertrain, retaining only 41.4% of their original list price.
November saw two-to-four-year-old passenger cars sell slightly quicker than in October. These vehicles spent 82.6 days in stock on average.
Petrol cars sold fastest at 77.2 days, followed by HEVs at 77.5 days and diesel cars at 83.4 days. PHEVs took 90.9 days, while BEVs needed the most time to sell with 102.2 days on average, even with a significant decrease compared to October.
Last year saw %RVs fall 5% year on year. In 2024, the values of three-year-old cars are forecast to keep falling from a relatively high point, set against a wider declining trend.
‘By the end of the year, used-car values are expected to decline by 5.7%. This is due to relatively stable supply and significantly lower demand in the last few months. For 2025, a slightly lower drop of 3.4% year on year is expected,’ outlined Annen.
Balanced supply in the UK
The average three-year-old car in the UK retained 51.1% of its original list price in November. That is only 2.2pp lower than where %RVs began the year. This indicates that the used car market in 2024 has been more consistent when compared to the start of the COVID-19 pandemic.
In November 2023 alone, %RVs fell by 2.3pp. In contrast, the decline was only half a percentage point this November. This was underpinned by a balanced supply and demand dynamic, with fewer than usual de-fleeted cars hitting wholesale channels.
‘Interestingly, BEV %RVs increased in November by 0.5pp as their popularity in wholesale channels continues to grow,’ noted Jayson Whittington, Glass’s chief editor, cars and leisure vehicles.
‘It seems used retail prices have hit a sweet spot that has attracted more retail buyers to consider the technology, and dealers are becoming familiar with buying them for stock,’ he continued.
Increasing BEV variety
It helps that a greater range of BEVs at different price points are now entering the used-car market, giving consumers more choice and allowing dealers to sell them quickly. All-electric vehicles took 26.2 days to sell on average according to this month’s report, which is just over eight days faster than the overall average.
The average (absolute) trade RV of a BEV at three years of age was £14,423 (€17,378) in November. This was the second lowest trade RV for any fuel type, behind only petrol which stood at £13,457.
‘So, BEVs appear a very good value-for-money proposition as a used car. This is made even more apparent when compared to the average BEV list price, of £39,755,’ Whittington concluded.
