Fleet News

Used car values reach all-time high in 2012

Analysis of vehicle prices by BCA shows the average value of a used car in 2012 was the highest annual figure on record.

An average of £6,199 represented a rise of £280 compared to 2011 (up 4.7%), and £358 (6.1%) compared to 2010. The data from BCA also shows that not only have used cars values risen, but both average age and mileage have increased over the past three years. 

BCA’s managing director Spencer Lock  said: "These latest BCA figures provide further proof that the stock shortage resulting from depressed new car sales since 2008 is having a significant effect on used car values three and four years down the line.

"Used car retailers will continue to be faced with increasing competition when sourcing the most attractive and retail-ready used cars, because these are the cars everyone wants and they are in such short supply."

As in previous years, the rise in values accelerated in the second half of 2012, with the average value of a used car at BCA reaching £6,415, up by £408 compared to the first six months. It is the highest average value for a half year period on record. 

Fleet and lease car values in the second half of 2012 rose by 12.3% year-on-year, while dealer part-exchange car values rose by 12.6% over the same period.

Lock added: "While interest in the best retail quality cars can be exceptional, overall demand is best described as fragile. Dealers are less likely to speculate because they know retail buyers are pending very carefully and expecting great value for money."


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Comments

  • Robert - 28/01/2013 11:30

    The past three years have seen repeated stories of record used car prices, but I can't help feeling the auction trade is misrepresenting the true picture.

    Yes, the supply side of the equation is (and will continue to be) suppressed due to lower registrations since the 2008 crash. Which is lucky, because demand is down too.

    What appears to me to be driving the 'record' prices isn't the supply/demand gap, but an improving mix of vehicles, reflecting the relative (and absolute) growth in sales of premium cars - especially those of German brands - at the expense of volume manufacturers. An auction hall full of Audis, BMWs and Mercedes will of course command greater prices than one full of Fords, Renaults and Peugeots.

    But does it really matter? Isn't it just a bit of positive 'spin' from the auction houses?

    Well I think not.

    Talk of rising used car values brings an expectation of higher forecast residual values and lower ownership or lease costs. Now, whilst a well designed car policy does allow an organisation base its vehicle choice on whole-life costs, with 10-15% new car price inflation over the past three-four years those replacing a company vehicle now should not expect costs to be going down for a 'like for like' vehicle.

    So, we should welcome the current reasonably balanced used car market conditions, but not get carried away with talk of record prices.

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