Consumer appetite growing for affordable SUVs

Dealer Auction’s Retail Margin Monitor for November saw the Hyundai Tucson breaking into the top three, demonstrating a growing appetite for more affordable mainstream SUVs.

The Range Rover Evoque reclaimed the top spot, with an average retail margin of £5,100, the joint-highest average margin since the launch of the monitor in January 2022.

But it was mainstream models that caught the eye of Dealer Auction’s analysts. The Hyundai Tucson rose from joint-tenth in August to fifth place in October and third place in November, with an average retail margin of £3,300. November also saw the first-ever entry for the Ford Kuga SUV, in seventh place with an average retail margin of £2,975.

Dealer Auction’s marketplace director, Kieran TeeBoon, commented: “The Hyundai Tucson is a model on the up and it’s now competing with Land Rover and Mercedes-Benz in the top three. The Ford Kuga is a notable entry, we also saw the second-ever appearance of the Peugeot 3008, with the Kia Sportage, Peugeot 2008 and Volkswagen Tiguan sitting just outside the top 10. This jostling for positions suggests a growing appetite in the market for more affordable mainstream SUVs.

“With the ongoing realignment in the industry, Cox Automotive’s 2023 used car transactions forecast of 7.15 million remains a guiding light for dealers. And using all the data at their disposal will help them keep a steady course.”

At brand level, Land Rover retained its position at the top of the chart with an average retail margin of £4,450, followed by Mercedes-Benz (£3,300) and BMW (£3,200). Renault entered the table for the first time with an average retail margin of £2,300, joining fellow mainstream brands, Volkswagen, Nissan and Kia.

TeeBoon concluded: “With used car values under pressure, a data-driven perspective empowers dealers to optimise their stock buying, capitalise on trends and stay ahead as this realignment plays out. It’s important to price to the market in order to shift their stock quickly and profitably, while keeping in mind that buyer demand is likely to increase after Christmas.”

Richard Walker, data and insight director at Auto Trader commented on the findings: “That the Margin Monitor has this month recorded a joint-highest retail margin is a true testament to the current health of the market and the opportunities available as wholesale and retail prices become increasingly out of sync. As we’ve been reporting for some months now, retail prices remain robust across segments of the market, demand is solid, and cars are selling quickly. The findings from the Monitor show that more than ever, profit opportunities are in the detail.”

Dealer Auction is an independent company, created through a joint venture between Cox Automotive and Auto Trader.