Used van values reverse slide in January
Used light-commercial vehicle prices have started 2024 with positive signs of recovery, according to major auction house BCA.
Used light-commercial vehicle prices have started 2024 with positive signs of recovery, according to major auction house BCA.
Following a brief recovery in September when values rose by £368 (4.1%) month-on-month to £9,247, the overall value trend in 2023 has fallen steadily since April’s highpoint. October recorded a further fall to £8,705, down by £542 (5.9%) month-on-month and the lowest average monthly LCV value recorded since December 2020, when the UK was in-between lockdowns.
Sold volumes of light commercials remained positive across BCA’s daily programme of online LCV sales as buyers and vendors remained reasonably aligned on pricing expectations. Buyer numbers continued to rise month-on-month, as they have for most of this year.Performance against price guides fell to 97.5% (from 98.9% in May), underlining the widening disparity between values paid for the very best condition light commercial vehicles and those realised by more poorly presented vehicles.
Average LCV values rose by £126 in March compared to February, to reach £9,977 and sold volumes improved significantly as BCA offered circa 700 LCV’s daily across its online sales programme. Performance against price guides averaged 102.6% during March. BCA’s weekly valuation reports for March show that average values climbed steadily above £10,000 for the first time since January despite sold volumes being significantly higher in March.
BCA’s LCV buyer customers reported improved demand at retail level as January progressed, despite the continuing economic pressures affecting the small business sector and reports that business confidence has fallen amongst SMEs. Looking in detail at the weekly reports shows that average values rose quickly in the New Year, peaking at over £10,600 later in January, well ahead of where they have reached in recent weeks.
While average LCV values have risen for the first time in 2022, demand remains volatile with professional buyers continuing to focus on condition and presentation as critical factors, particularly when a vehicle has a good retail specification. Any imbalance in supply can quickly affect demand and values, notably when volumes of standard specification base models begin to rise.
Average price data shows some volatility in recent weeks however special events can play heavily into these variances. Vans suitable to be put to work in the burgeoning home delivery sector along with more specialist vehicles that support the civil engineering, building and construction trades still remain highly desirable, but condition and presentation have become increasingly important for professional buyers.
Drilling into the weekly data shows that LCV values remained relatively steady in recent weeks with the weekly average value very much linked to sale events taking place, and not volatility in the sector. Even while economic indicators have worsened with the inflation rate reaching a 40-year peak and interest rates climbing to a 13-year high, there is still huge demand for vehicles that can be put straight to work.
Following on from the record value of £10,812 seen in January, February maintained the consistent run of strong values seen throughout recent months, averaging £10,441 – the second highest monthly value ever recorded. Values averaged 101.2% of guide price across the board during the month.
Sustained demand for vehicles to service online shopping, home delivery and the buoyant trade sectors ensured average values remained well ahead year-on-year. Buyer activity continued into the festive season as BCA staged a comprehensive programme of sales between Christmas and the New Year, with over 400 different customers purchasing LCVs in the final week of 2021.
Underlining the demand seen for light commercial vehicles, values have risen by £2,422 in the past year, equivalent to a 32% uplift. Over 2,000 individual professional buyers competed for LCV stock at BCA during July.
Values continue to outstrip market expectations by a significant margin, with BCA averaging over 107% of guide prices across the month. Sale conversion rates remain incredibly strong, with significant levels of demand for younger, retail quality vehicles.
Shortages have led to an increase in the average sold values of second-hand light commercial vehicles, which according to the BCA, are up 57% year on year. At a time when many businesses are dealing with increased workloads as customer confidence returns following the easing of COVID-19 restrictions, this is a huge challenge.
Values continue to outstrip guide prices, continuing the well-established trend seen over the past year and sale conversion rates remain incredibly strong, with significant levels of demand for any vehicle that can be “put to work” immediately.
Sale conversion rates for LCVs improved during March, rising to nearly 80% and with younger, higher grade examples generally selling the first time they are offered. Buyers are willing to pay a premium for vehicles that are ready to go back to work without the need for bodywork or mechanical repairs.