New Record for Domestic Used Auto Market in April

“After the monthly volume of used car sales hovered around 70,000 last year, the domestic market has seen a spectacular rise since the beginning of the year,” says Bertalan Halász, CEO of jóautók.hu, which runs Hungary’s first verified used car marketplace.

“In February and March, the number of vehicles changing hands was regularly above 75,000, but the preliminary volume of over 80,000 in April is an unexpected development, even if the final figure may remain slightly below 80,000.”

The spike in activity is due to a combination of factors. The fall in inflation has brought a rebalancing of household incomes (helped for many by the current high yields from government bonds), and interest rates have fallen spectacularly, boosting credit sales.

In some used auto segments, last year’s price falls have not been followed by a rapid rebound, with many cars still being offered at affordable prices. In addition, in the first four months of the year, new car sales were up by 10%, and imports of used cars were up by almost 4%, which also provided a further boost to the domestic used auto market as replacement vehicles came onto the market.

Older and Cheaper in Vogue

“In the previous year or two, many people postponed their purchases because of soaring used car prices and falling real wages, and some of these transactions are now materializing,” Halász says. “As a result, it is mainly used cars that are coming onto the market in greater numbers than planned. There has been a shift towards older and cheaper vehicles than before, so for now, it is the lower end driving the market,” he adds.

Although the general market environment still harbors uncertainties, the momentum at the beginning of the year means there is a growing chance that the annual record will be broken in 2024; the previous peak of 825,000 was reached in 2022.

The Hungarian second-hand car market was dominated by lower-middle-range autos (29%) and small cars (21%) in the first four months of the year. The most popular models in the former category are the Opel Astra (5.2%), Ford Focus (2.9%) and Volkswagen Golf (2.6%). The Suzuki Swift (4%) is the most popular small car, followed by the Opel Corsa (2%) and the Volkswagen Polo (1.5%). In the upper mid-size segment, the top sellers are the Volkswagen Passat (2.8%), the Skoda Octavia (2.6%) and the BMW 3 Series (2.2%).

Looking at January-April, the 305,800 autos changing hands on the used car market is 14.4% higher than the 267,200 registered in the same period last year. The number of used cars imported in the same period was 36,100, up 3.4% on 2023.

This article was first published in the Budapest Business Journal print issue of June 14, 2024.