Motability is fastest growing sector in first half of year

Registrations data from the Society of Motor Manufacturers and Traders reveals the Motability sector is outpacing the market in the first half of the year, up 45% year-on-year.

With volumes almost hitting 200,000, Motability’s share of the market sits at 19%, up from 14% over the corresponding period in 2023. Just over 25,000 of those cars were full electric, accounting for 13% of Motability units.

As a sector, Motability was responsible for 15% of the 167,096 electric cars registered in the first six months of the year.

Motability cars typically return to market after three years with remarketing tightly controlled by the organisation to protect residual values and future discounts from its manufacturer partners.

Auto Trader is conducting analysis of the market to identify levels of used car supply in the coming years by age, source and fuel type to assess the areas at greatest risk.

Demand for used electric cars was 69% in June, with supply at 40% indicating a healthy balance on the Auto Trader platform; however, speaking on the Q2 broadcast of the Fleet News Market Insight with Auto Trader, director of automotive finance Rachael Jones suggested a flood of stock from one part of the market could unsettle the equilibrium.

“That is where we need government support,” she said. “We need the demand to remain high so we need targeted financial incentives on used electric cars to get better adoption.”

Retailer confidence is an area that is being overlooked, with some reluctant to secure stock of used electric cars.

“Retailers got their fingers burnt in the last year 18 months, and there's definitely still some nervousness amongst some,” Jones said. “Only about 15% of independent retailers have stocked an EV to date.

“So, when fleets are putting out their EV stock to trade, they're not able to sell to the whole market like they do with ICE vehicles.”