Fleet News

Manheim data disproves popular December dealer 'myth'

Manheim is warning that dealers collecting stock in December and waiting for the January 'bounce' could be taking a risk.

The perceived wisdom in the run-up to Christmas is that cars are better value to buy from wholesale sources through the latter months of the year.

As a result, many dealers look to collect stock on forecourts that can then be sold at the start of the following year for a predicted higher value. However, Manheim data shows that the opposite situation has more recently been the case.

During winter 2012/13, market figures from Manheim show that the wholesale value achieved at auction was higher in December than January.

In December 2012, the average selling price at auction across the entire market was £5,361, with values falling to £4,786 in January 2013.

In addition, for the same period, the average reserve price fell by £666, from £5,501 to £4,835, while the average CAP clean values fell from £5,699 in December 2012 to £4,980 in January 2013.

Daren Wiseman, valuation services manager at Manheim, said: "The figures that we have suggest that the January bounce that many vendors rely on to maximise wholesale values is not always the most appropriate approach within the current market.

"There are many reasons to sell before Christmas, but perhaps the most important is that costs involved with holding on to stock will be minimised and unnecessary interest charges can be avoided.

"This, in turn, will provide a strong balance sheet at the end of the year and can enable volume targets to be reached.

"In addition, Simulcast is driving changes in buyer trends and allows vehicles to be purchased throughout the festive season, rather than causing a lull in the market before Christmas. Relying on the January bounce could, therefore, be a risky strategy, especially as the market is so strong at present."

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