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Used values bounce back

BCA’s latest Pulse report shows that the headline average monthly used car value in May recovered sharply from the fall recorded in April.

It rose by more than 8% to above £7,000, with year-on-year values up by over 15%.

However, BCA also reports that demand from professional buyers remains patchy, with interest polarising around the best retail-ready examples in the used car market.

Across the board, used cars averaged £7,045 last month, up by £543 compared to April and significantly ahead of May 2012 by £947 (15.5%). 

It is the first month-on-month increase recorded since December last year. 

Fleet and lease values improved to the second highest average on record, while dealer part-exchange values climbed yet again to a new record level, recording a massive year-on-year uplift in excess of 30%.

Nearly-new values improved largely thanks to a change in model mix.

Simon Henstock, BCA’s UK operations director, said: “As the volume of our inventory rises, buyers have greater choice than they did earlier in the year and this is reflected in sale conversion rates that are lower than they were. 

“However, there are still some concerns over the quality of the stock reaching the marketplace and this is creating a polarisation of buyer interest around the best retail-ready cars.

"For these best examples, values continue to routinely outstrip price guide expectations and this is helping to keep average values high across the board.”

He added “Dealer part-exchange volumes have held up well, despite suggestions that more vehicles are being retained within dealer networks for retail.

“There is certainly a trend for dealers to keep their options open by offering vehicles in several channels at once and take-up for BCA’s unique Appraise, Value and Sell tool would suggest this is set to grow. 

The number of dealer groups using the service has risen six-fold in recent months, with volumes being offered in BCA’s Bid Now, Buy Now and e-Auctions also rising sharply.”

Fleet and lease cars averaged £8,804 in May, a rise of £212 (2.4%) compared to April.

CAP performance improved marginally to 94.8%, while retained value against original MRP (manufacturers retail price) fell slightly to 41.95% across the fleet and lease sector at an average of 39.7 months and 45,500 miles. 

Year-on-year, the fleet and lease sector recorded a significant £870 (10.9%) uplift. Average age and mileage were virtually static month-on-month, but down year-on-year.

Average part-exchange values improved by £123 (3.4%) to reach a new record average of £3,718 in May. 

Average part-exchange values have remained on a high since December last year, with no sign of values returning to earlier 2012 levels. In fact, year-on-year values were ahead by £871 (30.5%) on May 2012 and the highest year-on-year uplift recorded in the dealer part-exchange sector. 

CAP performance remained static at 93.4% in May.

Average values improved in the nearly-new sector in May to £19,919 from £19,663 in April, with performance against CAP Clean falling marginally to 98.6%. 

Nearly-new values will always be affected by changing model mix in this low volume sector.

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