Auto Trader says new car market ‘remains challenging’ despite sales rise

Auto Trader has revealed a rise in revenues for the past six months, but said the market for new cars “remains challenging”.

Shares in the company slid after it downgraded the average revenue it expects to make per retailer this financial year, despite a higher level of transactions.

The FTSE 100 firm reported that group revenues increased 8% to £302.5 million for the latest half-year.

This came as retailer revenues grew in line with expectations and number of retailer forecourts surpassed predictions.

However, it said this was largely driven by “lower yielding retailers” and has therefore had a “dilutive” impact on its average revenue per retailer.

Auto Trader also reported that it has seen a rise in “unique cars” sold through its platform, but an acceleration in the speed of sale means it has not witnessed an increase in live stock.

Nathan Coe, chief executive officer of Auto Trader, said: “Our strong results for the first half of this year reflect the record numbers of customers choosing to partner with us to retail vehicles and drive the performance of their businesses.

“We are confident in the outlook for the business given our strong market position, and the opportunity to use our unique data, technology and AI capabilities to improve the way vehicles are retailed in the UK.”

Auto Trader shares were 8.1% lower on Thursday afternoon.