The New cars 'cheaper than used ones

New cars are currently cheaper than used ones for the first time in the UK, according to a comprehensive guide to UK car prices.

Heavy discounting of new cars and rising prices of second-hand cars due to a shortage of supply have led to this bizarre situation.

Parker's says this is first time used cars have commanded a premium since it started collecting price data in 1972.

However, Parker's warns that this price reversal will not last long.

'Shifting stock'

The recession in the UK has led to a dramatic fall in demand for new cars, so carmakers are having to slash prices to entice customers to buy.

Indeed, figures out on Monday showed that car sales plunged more than 30% in March, compared with a year earlier.

At the same time, a shortage of good quality used cars has seen second-hand car prices rise significantly since the start of this year.

"Price cuts on new cars designed to shift stock, and big discounts from car supermarkets, mean that the price of selected new, pre-registered cars can be the same and, in some cases, even lower than one-year-old used cars with several thousand miles on the clock," Parker's said.

Price rises

For example, it has found a 2008 Vauxhall Corsa 1.0 litre with 5,160 miles on the clock for £6,494. A new, pre-registered 2009 version is available from one dealer for £5,995, a saving of almost £600.

But normality should return to car prices before long, Parker's added.

As stocks of new cars are reduced, deals will soon dry up, it said.

And imminent price rises for new cars will also have an impact.

"New car prices are set to go up, as a number of manufacturers are raising the list price of their cars to improve their margins, despite new sales continuing to slump," Parker's explained.

Ford are set to increase prices by 3.75%, Seat by 3.5% and Nissan by 3.4%, it said.

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