The first three months of 2022 saw a 7.9 per cent increase in the price of used cars, making it the tenth consecutive quarter in which prices have climbed.
According to data from DoneDeal, annual inflation for used car prices hit 30 per cent, averaging a monthly increase of 2.1 per cent.
Compared to pre-pandemic levels (January 2020), the overall inflation figure is now 53 per cent.
DoneDeal attributed the price increase in part to the large cohort of Celtic Tiger-era cars which are now becoming obsolete. This has hit the lower end of the market hardest, with low-value cars noting annual inflation of 36.9 per cent.
During the same period, prices in the upper end of the market grew by 20 per cent.
The Covid-19 pandemic and Brexit have also wreaked havoc on supply chains, and the stalled production of new cars has placed greater pressure on the used car market.
Brexit has seen imports from the UK drop by 56 per cent, from 108,083 in 2019 to 47,034 in 2021, while prices in 2020 and 2021 continued to rise on a monthly basis.
The outbreak of war in Ukraine has also had an impact on the motor industry, further impacting supply chains and driving up the cost of petrol and diesel.
Fuel prices hitting record highs in the past number of week seems to have drivers contemplating a switch to electric vehicles (EVs), as demand indicators noted an increase of 218 per cent compared to the same period last year, while such indicators increased by 30 per cent for hybrid vehicles.
As the production of new EVs is being hampered by the global chip shortage, the used EV market is experiencing increased demand as a result.