There continues to be price pressure in the used van market as average values for Fleet & Lease vans have fallen to their lowest point in 2008.
According to the latest data from BCA’s Pulse report, Fleet & Lease vans averaged £3,827 in June – the second month running that values have failed to break the £4,000 watershed.
According to BCA’s latest figures, Fleet & Lease Values fell by £152 from £3,979 in May, to record a 3.8% drop.
This follows a drop of £147, equivalent to 3.5%, between April and May.
Values for part-exchange stock rose marginally by just £10 in June to £2,074, following a fall of nearly £200 the previous month that was equivalent to a decline of 8.3%.
There was also continuing pressure in the nearly-new sector where average values fell significantly to £9,052, a drop of £1,056 against May figures.
Values are now some £2,000 behind those recorded in January 2008, although changing model mix at BCA will have contributed to these figures.
We reported the market slowing in April and May and this has continued in June.
While demand has softened, there continues to be healthy supply of stock in the market.
Unfortunately many of these vans are in poor condition, low specification and unpopular colours and in the current market they are very price sensitive.
The end result is that we are seeing more unsold stock than earlier in the year and conversion rates have fallen.
At the other end of the scale, well-presented ready-to-retail vans continue to make exceptional values, often soaring past guide prices.
This is typical of a cautious marketplace where professional buyers are cherrypicking
the best vans – everybody wants the same vehicles and buyers will often have to pay over the odds to secure them.
There is a two-tier market developing, not just in price but in demand.
Buyers want fresh stock and first time entered and realistically valued vans are selling well with sales converting in excess of 70%.
Re-entered vehicles, however, are struggling to get the buyers’ attention unless there has been a sensible price adjustment.
It is important that vendors are realistic about the current broad economic conditions in the UK.
This is not just seasonality affecting the market, but is a more fundamental re-aligning of prices in the retail and wholesale market.
We have enjoyed a buoyant marketplace for many months, but conditions have just got that bit tougher in recent weeks.