Dealers continued to achieve healthy selling prices for part-exchange stock at auction in January, in spite of a slight fall in average value throughout the first month of 2015.
The figures, released as part of Manheim’s January Market Analysis, confirm that in spite of an increase in both average age and mileage of ex-dealer vehicles at auction, the average selling price in January fell by just 3.5% month-on-month.
Monthly data on the performance of dealer stock at auction shows that prices achieved for used cars stood at £3,268 in January, just £115 short of December 2014’s average value.
This marginal decrease is in line with slight increases in both average age (to 103 months) and mileage (to 79,316) during the month.
Looking at the figures in closer detail, however, the data reveals that four of the 10 vehicle types covered in the report achieved value increases throughout January.
The most notable increase was found in the Coupe segment, which saw its value appreciate by £147 (or 2.6%) throughout the month.
This could be due to buyers seeking to purchase sporty, fuel efficient and low tax vehicles that move quickly off the garage forecourt in anticipation of the Spring sunshine.
Comparing January’s average selling price with the same time last year shows that vehicles still enjoy strong demand on the auction floor, with the average selling price of used cars rising from £3,209 to £3,268. This yearly increase occurred in spite of a rise in both average age and mileage. This could suggest that overall vehicle condition is now as important in shaping values as traditional influences such as age and value.
Darren Wiseman, valuation services manager at Manheim, saidd: “January’s figures reveal a largely consistent month for dealers, in spite of the small decrease in overall value. I said last month that the first six weeks of the new year are traditionally the busiest for auctions and that’s no different in 2015.
The challenge currently facing dealers is ensuring they accurately match demand with supply. It might still be freezing outside, but clever buyers are already looking to snap-up vehicle bargains better suited to summer driving.
"As we saw this month, the coupe witnessed the largest value increase over January and I’d expect that trend to continue as we edge towards the warmer weather.
“Going forward, my advice to dealers would be to ensure that their cars are retail-ready before going to auction. Using the coupe as an example again, that segment saw a sizable value increase in spite of a rise in both average and mileage.
"While it’s no secret that buyers still see age and mileage as amongst the most important factors when making a purchase; a car that’s in overall good condition is still likely to command an impressive price tag, even if it’s older with a few more miles on the clock.”
Age, mileage and selling price - January 2014 to January 2015