Used LCV value rise further as stock shortages bite

AVERAGE used LCV values improved by £58 last month to reach £4,229, equivalent to a 1.4% increase over June (£4,171), according to latest data from auction giant BCA.


Over the month, average age fell to just under 57 months, while average mileage rose by nearly 3,000 to 79,400. There were value increases in the fleet and lease and nearly-new sectors, while performance againstCAPaverage improved by two points to 97.7%.


Year-on-year, July was ahead by £99 (2.3%) compared to the same month in 2011, despite the average age climbing by over four months (up 8.8%) and average mileage increasing by 10,700 (up 15.6%). Performance againstCAPslipped by three-quarters of a point, year-on-year.


Duncan Ward BCA’s general manager – commercial vehicles, said: ‘July was a stronger month for average LCV values than June, but buyer confidence remains fairly fragile and there is a reluctance to buy vehicles in poor condition because of the investment required to get these vehicles ready for retail. Trade buyers are looking for a quick turnaround and often buying to order, rather than speculating on vehicles.


‘However, values remain relatively high because there is a real shortage of good quality, ready to retail used vans, which is leading to fierce competition and generally rising values for the best examples reaching the remarketing arena. This stock shortage is a long term issue and is unlikely to change while new van volumes languish well below pre-recession levels and the wider economic conditions remain so challenging.


‘There is also little good news in the economy for the sole traders and small businesses who typically buy used LCVs. If business confidence is low, replacing the company van may become a very low priority and that will inevitably hit demand in the wider used market.’


Ward added: ‘We have been advising our sellers for some time to review their remarketing activity to ensure their vans are presented in the most saleable condition to meet the demand that is there. This message increases in importance over the coming weeks as there will be the usual volume uplift in September and October that sellers should be planning for now.’


Monthly values in the fleet and lease LCV sector improved from £4,965 in June to £5,029 in July, which compares with £4,683 in July 2011. Performance againstCAPclimbed by two points to 99.8% and retained value against manufacturer recommended price over 44 months and 72,000 miles was 31.96%, marginally up on the June figure.


The year-on-year figures again highlight the longer term value growth across the fleet and lease sector. July 2012 was £416 (9%) ahead of the same month last year – despite the average van being two months older (44.5 months) and 9,000 miles higher (71,787) this year.


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