LCV values struggle as 2008 draws to close
Average values for LCV’s continued to fall in the final months of the year according to the latest data from BCA, with every sector under pressure. In particular, relatively poor price performance in November and December saw average values across the board fall significantly, with December being £41 behind November and £331 (10.6%) behind October. Over the year, values fell by £1,096 (28.3%).
However, LCV sales early in 2009 suggest the commercial market may be bouncing back in January, with BCA achieving several sold volume records around the network. However, this comes on the back of a year BCA is describing as possibly ‘the toughest in a decade’ for LCV sales.
Values in the fleet & lease sector fell a further £76 in December. Prices in this sector generally moved downwards all year and are now £1,149 – or 27.6% - behind the January highpoint. CAP performance has moved in a very similar fashion and now sits some ten points off the January peak of 93.39%.
Dealer part-exchange vans also fell in value in November and December, following decent levels of interest earlier in the autumn. Over the year, values fell by nearly £600, a significant 25.5% in this budget priced sector, from £2,322 to £1,728.
Nearly-new vans also struggled to maintain values in 2008, following the period of rapid growth in values the previous year when some manufacturers experienced supply issues on new stocks. Average values fell at BCA from £11,063 in January 2008 to £7,998 in December, a fall of £3,065 (27.7%).
BCA’s Duncan Ward, commented “The used LCV sector relies on a strong and confident economy for the small businesses and solus traders who are the key buyers of stock - either directly or via a retailer. As the economic turmoil has intensified in 2008,small business confidence has ebbed away and this is reflected in van-buying activity.
He continued “It is quite possible that last year we saw the toughest market conditions in over a decade. It meant vendors having to be pragmatic and accept the prices on offer just to keep the metal moving rather than aiming for book values. With credit tight, there were plenty of buyers and lots of activity in the budget sector, but demand slowed around £5,000 – this seems to be the upper limit that many buyers can afford without resorting to finance.”
“This has led to the unusual situation of the cheapest vans often being the most in demand.”
“Early 2009 has kicked off exceptionally well, however, with huge attendances at our light commercial sales around the network, with Blackbushe in particular setting sold volume records over two subsequent weeks. Professional retail buyers are active and are currently busy replenishing their forecourt stock. This has given an exceptional boost to conversions and prices. The real test will be over the coming weeks and will depend on the retail demand those dealers experience.”
