Fleet News

Marketwatch: Used car market is stronger for longer

THERE should be an increase in used stock until the end of the year as fewer sellers hold vehicles over for the January rush, but fleets are being warned there may not be buyers for the cars.

Traditionally a strong month, January 2004 did not see the usual lift in prices, so fleets are less inclined to hold stock back until January 2005 in case the same situation occurs again.

Mike Pilkington, managing director of vehicle remarketing solutions, said: ‘This year the market has remained stronger for longer and remains relatively stable for the end of September. I know of two major fleet vendors, which usually stockpile vehicles in December, but on last year’s experience feel it is not worth holding on to vehicles with the holding costs and will continue to trade through December.’

However, CAP has warned that poor retail conditions until the end of the year pose ‘serious financial risks’ to fleets, following a survey of dealers which suggested November and December would be a dead time for used car buyers. CAP Monitor managing editor Mark Norman said: ‘It suggests that the bulk of trade buying activity in November and December is aimed at building up stock levels for January, which our survey reveals as when retail sales begin.’

Both CAP and vrs have noted a number of fleets extending contracts from September, a strategy that helps maintain manageable stock levels.

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