Fleet News

Marketwatch: More clean stock sees drop in van values

A DECLINE in commercial vehicle sales is predicted over the coming months, bringing with it a weakening of residual values.

EurotaxGlass’s said this would be the first such downturn in six years. Previously, a strengthening UK economy has bolstered demand in the sector, preventing any significant seasonal fall in RVs but such a dip now looks unavoidable.

George Alexander, chief commercial vehicle editor at EurotaxGlass’s, said: ‘Following record sales over consecutive years, registrations of new vans and trucks have now eased back.

‘In addition, the UK economy has slowed, with just 2% growth forecast for next year.

‘Perhaps more significantly, the used market is no longer starved of clean, used stock. Accordingly, as we move deeper into the winter months, it is inevitable that we shall experience a seasonal downturn.’

However, Alexander said the longer-term outlook may not be so bad. He said: ‘While we would agree that December looks set to be a lacklustre sales month, with January being little better, prospects for spring 2006 are marginally brighter, so long as common sense prevails.’

A key issue will be how growing quantities of used stock are managed. Big vendors should act decisively to keep the used market active and prevent a large build-up of used stock, Alexander said.

‘Rental and leasing companies should ensure that each van they put up for sale is properly presented and priced to sell,’ he added. ‘New vehicles purchased should be specified to maximise their attractiveness to the used buyer at disposal time. A reserve should be just that, a figure set to act as a safety net to avoid any big loss, not a figure plucked out of the ether as a challenging obstacle to overcome.’

4x4 prices are on decline

THE winter months normally see a rise in sales of used SUVs and 4x4s, but with large numbers of prestige marques being offered, prices are falling at an increased rate. Affected vehicles include the BMW X5, Mercedes-Benz M-class and Range Rover.

The onset of colder weather also heralds plunging prices for convertibles and the sector has almost reached its seasonally low levels. However, premium-brand roadsters like the Audi TT, BMW Z3 and Porsche Boxster could fall further still before their depreciation matches the wider prestige market, Glass’s said.

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