The summer months have been interesting for market watchers – while the used LCV market remained strong, the early summer months brought with them a number of distractions, ranging from sporting events to the numerous Bank Holidays. With the benefit of hindsight, these distractions had little effect on the day-to-day market.
At the height of the summer, the market remained strong and prices were firm but how those prices were achieved was noticeably different to earlier in 2006. There were perhaps fewer buyers, but many vehicles still reached the very high prices we saw in the spring. On the other side of the coin, buyers had little enthusiasm for any vehicle that was poorly presented or requiring repair.
The market was less intense and frantic, yet a number of BCA’s corporate customers recorded 100% conversions and exceptional performance against guide prices. In a nutshell, good well-specified vehicles performed exceptionally well, while tatty stock struggled.
This is highlighted in BCA’s recently published Pulse Commercial Vehicle Report, that shows that values in the fleet/lease and P/X sectors stalled slightly in Quarter 2, while nearly-new values continue to increase.
In Q2 06, fleet & lease vehicles were remarketed at a slightly higher age – an additional two months older than the previous quarter, taking the average age to just over four years, while the average mileage remained remarkably consistent at 71,374 – a small variance of just 30 miles on the previous quarter.
Values averaged £3,544 in Q2 – a fall of £185 against the last quarter. Historically the summer holiday period sees some pressure on values and this year is no exception.
This can be seen more clearly by looking at the monthly averages – values were remarkably consistent from January through to April, being around or above £3,700. Post April (and post-Easter which is often seen as a watershed in demand) average values have softened by nearly £300.
While LCV stock is almost universally diesel-powered, small numbers of petrol/LPG units are now available to the used market. LPG values improved by nearly £400 in Q2 compared to the last quarter (although numbers remain small) and have closed the gap quite significantly on diesel values.
Vehicles from part-exchange sources averaged just over £3,100 in Quarter 2, 2006.
The age and mileage profile is slightly higher than direct lease stock and they are unlikely to have the benefit of just one company name in the logbook. Average prices over the two quarters are relatively consistent with a £102 variance equivalent to a 3.1% fall in Q2 06.
Competition for the few late-plate, low mileage vans that reach auction is intense and there is a huge price differential over the fleet/lease or P/X sourced vehicle – with nearly new values averaging around three times the average four-year-old van.
Nearly-new values increased by £350 in Quarter 2, representing a rise of 3.6%.
BCA market overview August 2006