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Used car shortage pushes average values up

Average used car values increased by 9.7% (£547) year on year in July, and increased 3.6% compared to June 2012.

According to the latest figures from BCA’s Pulse report the increase in values reflects the relative shortage of stock in the marketplace as a whole.

The trend can be clearly seen in both the fleet/lease and part-exchange sectors, which recorded 15% and 10.3% year-on-year value improvements respectively.

BCA’s figures show that average used car values increased to £6,180 in July from £5,964 in June.

Fleet and lease values reached another new high point, averaging £8,053 – up just £11 from June’s figure – but still the highest monthly value on record.

Part-exchange values posted a £75 month-on-month rise, to reach £2,949 – also the highest average value on record since BCA began publishing its Pulse Reports.

Nearly-new values improved by £780, largely as a result of changing model mix in this low volume sector.

Across the board, used cars averaged 96.94% of trade guide prices in July, up by nearly a point compared to June, while average age and mileage both fell marginally over the month, to 62 months and 59,000 miles.

Tony Gannon, BCA’s communications director, said: “It might seem counter-intuitive to report that used values have apparently climbed so sharply year-on-year, despite the continued challenging economic situation and relatively weak retail environment.

“However, supplies reaching the wholesale used car market are quite significantly down on the peak seen four to five years ago.

“The combination of lower new car sales and the tendency for vehicle owners to extend their replacement cycles simply means less stock is available to be sold”.

Gannon said there is a real shortage of good quality, ready to retail used cars which is leading to fierce competition and generally rising values for the best examples reaching auctions.

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