Vertu Motors PLC (LON:VTU) upped its profit forecast for this year saying second-hand car prices are rocketing due to a shortage of new vehicles.
“A tightening of new vehicle supply, largely reflecting component shortages flagged in the year-end announcement, is increasingly apparent,” it said in a statement.
“The expected time between order and delivery of new vehicles to customers for certain of the group’s franchises is now seeing elongation.
“The reduction in new car supply is contributing to a reduced supply of used vehicles, with a resultant exceptional wholesale pricing environment,” it added.
This shortage is being exacerbated by strong demand from customers, Vertu added.
“In light of the strong trading performance to date, driven largely by the exceptional used car market environment, the board now anticipates that the group’s full-year adjusted profit before tax will be above current expectations and in the range of £28 – £32mln.”
Share rose 0.9% to 46.3p.