The latest BCA Pulse report shows average used car values have risen for the fourth month running. BCA’s Tony Gannon reports.The latest BCA Pulse report shows average used car values have risen for the fourth month running.
February 2009 posted a L435 rise against January (up 8.4%). This was L300 up on December’s figures.
While average monthly figures remain behind those recorded in 2008, the difference is narrowing: February 09 was just L282 adrift of February 08; in January the gap was over L650.
Used stock from all sources has been even more limited than it was in January. With high demand and limited stock, values have kept firm.
There is now little doubt that used values are making a seasonal but possibly significant recovery from the low points of last year.
Possibly the market is experiencing some deferred demand from last year, as potential buyers held back from any big-ticket purchases as the economic turmoil became apparent.
While supplies of vehicles are relatively thin in the wholesale market, it is likely that average prices will be maintained at this higher level. With no indications that volumes are going to ramp up hugely over the next few weeks, BCA expects March to remain fairly strong. And with a late Easter, April may also be relatively buoyant.
The post-Easter period and the run-in to the summer months may prove more problematical for vendors, however, particularly if volumes increase notably.
February overview by sector
Overall average monthly used car values rose in February, with every individual sector enjoying an increase in values.
Fleet & Lease sector
Average monthly Fleet & Lease values rose to L6,286 in February from L5,719 in January and L5,471 in December. Values are at the highest point since May last year. Year-on-year, average fleet and lease values in February are down by L426, having been almost exactly L1,000 behind last month.
Other parameters remain largely static – there are no signs as yet of an increase in average age and mileage that would reflect any contract extensions in the leasing sector. In fact, year-on-year numbers are slightly down for age and mileage.
Part-Exchange sector
Values increased in the part-exchange sector for the third month running. Average price improved by L128 over January’s figures. There has been a relative shortage of part-exchange stock as retail new volumes remain slow. This has helped to keep prices on a reasonably even keel.
Nearly-New sector
Perhaps surprisingly given the difficulties of the new car market, the nearly-new sector staged a strong comeback in February. It was the only sector to average a decrease last month.
February saw values rise by L1,925 to L15,129. Year-on-year values remain behind by around L1,000.
Specialist car sectors: large 4x4s
Values for larger 4×4 vehicles continue to enjoy a recovery after falling sharply last year. Average 4×4 values have risen steadily since July last year. They are now ahead of where they were in February last year, having reached L8,743 in February 2009 for a four year old vehicle at 50,000 miles.
Prices are now on a par with those recorded before the credit crunch began to bite in January 2008, when values were at L8,813. Values reached a low point last July when several months of high fuel costs, combined with the stuttering economy and uncertainty over proposed Vehicle Excise Duty and the so-called Showroom Tax saw values fall by over L2,000 to L6,723.
Specialist car sectors: MPVs
MPV values fell consistently through 2008, from a peak of L4,804 in January to reach a low point of L3,637 in November. Values have recovered steadily to reach L4,179 by February 2009, but remain some L500 behind, year-on-year.
