The nearly new sector is going to be an increasingly important part of the used car market in the New Year as buyers are ignoring new cars in favour of used, according to Meridian Vehicle Solutions.

Managing director at the medium term rental specialist Phil Jerome, said a survey of 15,000 peoploe conducted by AA-Populus showed 29% of people intended for their next car to be nearly new.

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Jerome said: “Consumers continue to view the new car market with some suspicion. A combination of ongoing political and economic uncertainty, confusion over diesel, the introduction of EVs, plus reduced manufacturer finance support, are all having an impact. For many of them, the nearly new market looks like a much safer bet. An increase in the number of pre-registrations means that there is a lot of stock around, it looks like good value at windscreen prices and the growth of used car PCP makes it very affordable.”

“For franchise dealers and even for bigger independents and car supermarkets, we very much expect this to be a growth market in 2020. Demand is strong, supply is good and margins remain healthier than in many other parts of the market,” he added.

Jerome also said Meridian operated almost exclusively in the nearly new sector due to its business model, and therefore developed a deep understanding.

Jerome said: “We dispose of cars at between 6-12 months old and so are very sensitive to changes in this market. This is our home turf and our view is that it has definitely become a more vibrant sector in recent months. The factors powering this trend should continue.”

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“However, the cars that perform best remain the ones that are retail ready, that dealers can valet, photograph, and put on sale in a matter of a couple of days. Both the consumer and the trader expect cars of this kind to be almost indistinguishable from new and no-one wants to spend time and money on any kind of repair work. The vehicles must be close to perfect and ready for sale – and that is what we provide,” he added.

He said Meridian intended to retail some cars direct to consumers in 2020 and would announce details about these plans early next year.

Meridian’s medium-term rental cars are supplied new from a franchise dealer on contracts ranging from 6-12 months at monthly rates.