Auction houses in the UK have experienced buoyant demand for used vans in recent months as trades returned to work after lockdown and online shopping activities remained strong.
Also, the used market has been boosted by the delays and problems surrounding the supply of semiconductors and other smaller components to manufacturers over the course of this year, which has meant that a lot fewer new vans have been registered.
With demand continuing to exceed supply, used van values continue to be much higher than last year and the auction houses have recorded huge monthly price increases.
Commercial vehicle auction house Manheim has experienced a series of record breaking months in 2021 and September saw its average selling price rise to a new record level of £10,930 – an increase of £352 on the previous month.
Also remarkable is that at the same time the average age of vans rose by three months and average mileage went up to 79,356 miles, an increase of 6,034 miles compared with August.
In addition, the average price of Euro-6 vans at Manheim increased by £953 compared to August, and again to a new record of £14,675 with excellent demand for large panel vans.
Manheim says two to three-year old Mercedes-Benz Sprinters, Ford Transits and Volkswagen Crafters have been particularly popular as the clean air agenda has come to greater prominence.
Stuart Peak National LCV Manager at Manheim said: “Comparing September 2021 to September 2020, our average selling price has risen by 30% which blows my mind.
“The much talked about challenges around new vehicle supply have clearly helped to drive the market and we don’t see this changing anytime soon.
“Each empty space on a forecourt is a profit opportunity and with many dealers running as little as 40% of their usual holding capacity, competition remains fiercely strong throughout our LCV sales events.”
In October Manheim saw a fall in average selling price compared with September, down to £10,323 for the month, but still a huge increase on the previous year’s figure.
According to the company, the dip was due to the average age of vans at its auctions increasing by three months and mileage going up by just under 6,000.
However, Peak said: “It is worth noting that this was the highest average mileage that we have seen in nine years.
“It just goes to show the pressures caused by a lack of stock, and highlights the fact that vehicles are having to be used for longer than they usually would be.”
For van auction firm BCA, average monthly values continue to be well ahead year-on-year, with October 2021 values being ahead of the same month last year by £2,104, equivalent to a 27.1% uplift.
However, the company says values moved by just £259 or 2.6% in the five months to October with prices averaging £9,861 as solid demand matched a good level of supply across its sales programme.
Stuart Pearson, BCA COO UK said: “Similar new vehicle supply issues have impacted both the car and commercial vehicle market place in 2021, albeit the acceleration of LCV prices came much earlier in the year.
“Values have remained stable since the LCV sector saw prices peak in the summer, which potentially highlights what’s to come for cars too.”
BCA’s commercial vehicle auctions offer up to 700 vehicles each day and attract more than 2,000 different buyers each week.
Pearson said that to serve demand, the company continues to make improvements to its LCV grading process along with technology upgrades and enhancements to the company’s website and the BCA Buyer app.
He said: “The long waiting lists for new commercial vehicles continue and our buyer base has been enhanced by increased activity from the franchised dealer networks who have been particularly competitive when it comes to sourcing used stock.
“With delays in delivery of some new models anticipated to continue well into next year, LCV values in the wholesale used market are expected to remain strong for some months to come.”
Parcel delivery companies and their sub-contractors have been getting their fleets ready for another record Christmas of home deliveries, and with the supply of new vans still restricted, these companies have also been forced to buy from the used market.
According to Louise Wallis, Head of National Association of Motor Auctions (NAMA), the auction market remains buoyant and continues to grow despite times of economic uncertainty.
She added: “Demand for LCVs has been extremely strong for the industry as online sales have been established as a crucial component towards the market’s growth.
“The shift in consumer shopping activity from physical to online retail and the subsequent increase in deliveries has been supporting demand for used vans.
“Going forward, we expect the auction market to remain at high levels especially if online sales continue to perform well”.
Meanwhile, Toyota’s Hilux pick-up was the most sought after used light commercial vehicle for the second consecutive month according to Aston Barclay’s November LCV desirability index.
The firm’s desirability index takes into consideration three key metrics: web views prior to sale, number of physical and online bids per sale, and the sale price achieved as a percentage of CAP average.
Aston Barclay saw the Toyota beat the Mercedes Sprinter and Peugeot Boxer into second and third place.
Geoff Flood, Aston Barclay’s LCV national sales manager said: “The used van market continues to break records because the supply of used LCVs coming into the market continues to falter.
“Companies continue to hang onto used vans and are being forced to bid at auction to source used vehicles to expand their fleets. This looks likely to continue for many more months to come.”
It is worth adding that used electric LCVs are unlikely to hit the auction houses in quantity for some time, probably around the middle of the decade.
The mass supply of these vehicles is only just starting to take place and a majority of the orders are being placed by major fleet operators who could well hang onto them for another five or six years.
