Breath held, fingers crossed: after months of record profits, car retailers are currently hoping for the best and preparing for the worst – and if they were offered the choice, they would probably be happy with something in between.

Most notably, we’re at a curious moment for the used car market, with prices slowly but surely trending downwards despite supply being historically tight and demand reasonably high.

The surge to historic highs was caused by the pandemic, of course, with everything from a reluctance to take public transport to post-lockdown ‘revenge’ buying – a term to describe rewarding yourself after a period of hardship – given as reasons for the booming demand that started to push prices up.

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Whatever the causes, it was an incredible ‘Get out of jail’ moment for dealers. Used cars traditionally lose value over time and those early months of lockdown, when almost no trading was possible, left dealers with stock on the forecourts that would normally have depreciated before their eyes. Instead, the profits started rolling in.

As the stop-start nature of the pandemic played out, that demand, combined with a new car market increasingly strangled by the semiconductor shortage, pushed used car pricing to historic highs. Tales of nearly new cars selling at a premium over factory-ordered ones were commonplace. With used car margins far exceeding new ones, the trading reports of big dealership groups became the stuff of fantasies.

There’s no suggestion – yet – that the boom will end as quickly as it began, but there are now enough signs of pricing weakening for it to be a trend. Figures from the Office for National Statistics highlight falls over each of the past five months – the longest streak since 2017 – with the latest information suggesting a 2.5% fall last month alone.

While the market was always going to run out of steam, the overriding concern is of the bubble bursting. There’s no sign of it yet – in fact, some startling Auto Trader data suggests the average price of a used car pre-pandemic was £12,798 and today it is £17,298 – but the triggers for prices weakening (fuel price rises, wider cost of living pressures and fears of a deep, long-term recession) don’t look like they’re going away any time soon.

Hopes of some respite coming in the form of new car chip supply recovering are looking increasingly shaky, too, although some brands are faring better than others. Just as Volvo revealed it was running at full capacity again, so Toyota admitted that its once strong supply was – temporarily – wavering. An industry-wide return isn’t now expected until 2025.