LCV Demand 'Unseasonably Strong' in August

LONDON – September 28, 2009: BCA recorded unseasonably strong demand in the LCV sector during August, traditionally a month that sees lower values. Average values for fleet & lease, dealer part-exchange and nearly-new vans all rose, and for the first time all three sectors achieved over 100% of CAP values.

According to BCA’s Pulse report, average used LCV values across the board improved in August by £179 (5%) to reach £3,745 – the highest point since April 2008. Year-on-year values were ahead by over £500.

Average fleet & lease van values improved by £203 against July (up by 5.2%) to reach £4,045 – the first time the £4,000 barrier has been breached in sixteen months. Dealer-entered part-exchange stock rose by £160 (7.5%) following a 9% rise in July and, after a sharp fall last month, nearly-new values recovered by over £1,000 to £9,034 - the third highest average monthly value in this sector this year.

The average performance against CAP across the board reached a new highpoint of 101.67% in August and, for the first time on record, all three sectors averaged over 100% of CAP in the same month. Duncan Ward, BCA’s General Manager Commercial Sales commented “August proved to be a remarkably strong month for LCV sales and certainly outperformed the customary ‘summer holiday season’ market.

He continued “Supplies of good retail quality vans were relatively limited and buyers were bidding strongly for the best examples – particularly from the fleet sector where competition was intense. A number of corporate vendors recorded 100% sales conversions for the first time, and many sales averaged over 100% of CAP across the board.”

“Professional buyers who would usually buy stock exclusively from corporate sources were having to look further afield and were bidding on younger or older vehicles to stock their forecourts.”

Ward explained “The end result was to increase demand not just for fleet and lease vans, but also for the nearly-new and the dealer P/X vehicles. Increased buyer traffic on BCA’s Live Online internet bidding service also suggested that dealers were looking far and wide to meet the needs of their retail customers.”

BCA’s report asks the question that with September values traditionally representing a peak in the annual price cycle, could values be climbing again following a period of five months when they have remained fairly static?

Ward commented “As this has occurred in a month that usually records weaker prices, this could yet mark a significant point in the price recovery for LCVs. If such a rise had occurred in September, it would have been equally welcomed by vendors, but much less notable. It remains to be seen if the market is going to march on into the Autumn months and perhaps consistently register values to compare with the market highpoint in early 2008.”