CAP has issued an average downward price revision of 4% in used values in its June Black Book update.

The news comes in the wake of Manheim reporting a 2.3% fall in used car prices in April, while BCA announced performance against CAP Clean had fallen by nearly two-and-a-half points.

“After a long period of stability the previous six weeks have seen the market first ‘feathering away’ before slowing very significantly,” CAP reports in the Black Book editorial.

“It is now important to understand the subtleties of the market dynamic, which means recognising that not all cars are the same. For example, despite the more challenging conditions, desirable cars have continued to command strong prices and indeed sometimes in excess of CAP Clean.

“But at the same time, a large and increasing number of vehicles which are not in clean condition are failing to sell at all. This is not because there is no market for anything but the best cars, rather because many vendors have been refusing to accept what are in truth fair bids that reflect the investment required in refurbishment.”

To illustrate this, CAP says an industry source estimates that cars which can justifiably be described as CAP Clean represent only around 15% of those being offered.

This has resulted in a build-up of volume and cars making repeat appearances and consequently receiving ever lower bids, according to CAP.

“We have consistently identified late plate supply as a critical factor in the residual value strength of the market after the lessons of last year’s dramatic upswing,” continued CAP.

“In short, a shortage of nearly new stock diverts demand down the value chain and helps to prop prices up. Conversely, increases in late plate supply weakens values and this ripples down through the age bands.”

CAP says this represents additional downward pressure on values at a time when economic and consumer confidence is fragile at best.

“There is no suggestion that this market is like that of 2008, but nor are there any significant indicators that conditions will improve in the short term,” concluded CAP.