LCV values at BCA came under pressure in October as professional buyers continued to react to the tough economic conditions affecting the wider market, particularly the small business sector which represents the biggest purchaser of used LCVs.
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.
Performance against guide price expectations averaged 98% at BCA in October, which suggests that despite the pressures buyers and sellers are broadly in tune on price expectations. Demand for the very best condition light commercial vehicles continued to significantly outstrip interest in more poorly presented vehicles.
Much of the steady fall in average values this year results from the changing mix of stock and rising numbers of lower grade vehicles reaching the marketplace in recent months. The steady recovery of the new van market – up by 28.1% in September and 17.7% in October – has also taken the heat out of the used LCV sector.
Anecdotal buyer feedback suggests the used LCV retail market is exceptionally tough across all sectors and it was notable that LCV values stuttered late in October in anticipation of the publication of the November price guides. Monthly buyer numbers at BCA continued to increase, however, and sold volumes of light commercials remained consistent as BCA’s daily programme of online LCV sales continued to deliver a wide range of stock for buyers.
Stuart Pearson, BCA COO UK commented “As we have reported in recent weeks, we have a two-tier market operating, where well presented, higher grade vehicles attract a lot of competitive bidding, while older, lower spec volume models can be challenging to remarket, particularly if they require repair and refurbishment.”
“Compared to the previous 24 months where new and used supply was constricted and demand was high from retail customers, the current position is an almost complete reversal. Used volumes are lifting and there is more choice around new LCV supply, so it should not be a surprise to see values moving downwards.”
“While the LCV market is not subject to the same pressures as the retail car sector, there is no doubt that small business van users are being prudent when it comes to acquiring a replacement vehicle and this is being reflected in activity within the wholesale sector. Professional buyers at BCA are choosing stock carefully, avoiding vehicles that appear overpriced or requiring significant work to get into retail condition, and are generally treading with caution while these conditions continue.”
Pearson concluded “The market remains very price sensitive and is likely to remain so as we move into the festive period. There will undoubtedly be some seasonality at play, however, with values moving to a level that many feel are more realistic and supply becoming more readily available. These factors could help to kick- start a little more positivity in the wholesale market as we cross into the New Year.”
*Article Source www.bca.co.uk