Fleet News

Christmas cheer for used market

DEMAND for used cars looks set to outstrip supply early next year – giving fleets some Christmas residual value cheer.

Used car values are already beginning to rise and could show more growth in the next 12 months, but the fortunes of companies at auction very much depend on which vehicles they are running.

Figures from the CAP Index reveal values for three-year/30,000-mile cars were up 0.1% on the same period last year in November.

But while the value of lower- medium cars was up 1.2% and executive cars by 5.6%, MPVs were down 5.3% and upper-medium cars down 0.7%.

CAP economics editor Ramesh Notra said: 'This kind of stability is valuable because it encourages the trade to look forward to the New Year when retail demand for used cars tends to return.'

Manheim Auctions' senior group auctioneer, Andrew Shepherd, anticipates an 'upbeat start' to the new year.

He said: 'All the signs look as though January could see a supply and demand problem with demand outstripping supply. With this in mind, it would be prudent for all vendors to release as much stock as possible into the market during January and providing a steady supply of vehicles comes into the auction halls during the first three months, we should see a very upbeat start to 2003.'

Shepherd added: 'A lot depends on the quality and quantity of stock on offer – it is the quality vehicles that are the ones achieving CAP Clean and readily finding buyers. 'The market for the time of year is still holding up well and it looks as though this will continue up to the Christmas period.

'Business is not as buoyant as it was two weeks ago and the 'edge' has definitely gone off the market, but, considering we are only a few weeks away from Christmas, it is good to see that trading generally is alive and well.'

Experts behind the Alliance and Leicester Car Price Index, which measures forecourt pricing, claimed the value of three-year models fell 5.4% in October compared to the same period last year. It said only compact executive and luxury cars showed a rise in price.

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