Values of used light commercial vehicles (LCVs) are continuing to rise despite increasing volumes of used LCVs coming to auction and record registrations of new LCVs says Alex Wright, managing director of Shoreham Vehicle Auctions.
Over a four-year period from January 2012 to December 2015, the average number of newly registered LCVs has rocketed, with a record number of units ' 371,830 ' registered in 2015, the highest since 2007. This has resulted in a delayed influx of vehicles into the used market, with volumes steadily rising over the same period.
Yet average used prices have also continued to rise, despite the increase in supply to the market. Wright says this is driven by very strong demand from buyers.
'It's remarkable that prices continue to rise in line with increasing volumes,' he said.
'We expect to reach the tipping point where supply outstrips demand and puts pressure on prices, but recent trends have defied this.'
With increasing numbers of SMEs purchasing LCVs between two and four-years-old on short-term PCP deals, vehicles are then being sent back into the auctions for the manufacturer's franchised dealers to purchase at a reduced rate.
Furthermore, SMEs that cannot secure vehicle finance are heading to auction to secure LCVs between four and six-years-old, in good condition and at reasonable prices.
According to the latest LCV manufacturing data, there's no sign of LCV registrations letting up, with 27,880 new units registered in April 2016. This was an 11.7% increase on the April 2015 total, and year-to-date, a 3.3% increase on the first four months of last year.