Fleet & lease values reach record levels in October, reports BCA
The headline average value of a used car increased to £7,992, despite performance against CAP Clean falling by two percentage points to 96.63%. Year-on-year, average values were up by £244 (3.1%), with age static and mileage continuing to fall. Performance against CAP was up by one percentage point compared to 2014.
Fleet & lease car values averaged £9,848 in October, rising by £148 (1.5%), compared to September and reaching the highest point on record since Pulse began reporting. Despite this, retained value against original MRP (Manufacturers Retail Price) was down slightly at 41.80% (from 42.09% last month), with age and mileage broadly static. Compared to October 2014, average fleet & lease values were up by £315 (3.3%), with performance against CAP Clean up by half a point and retained value down slightly on 2014.
However, despite the strong price performance, BCA also noted that increased volumes and the rising numbers of poor condition cars could impact market performance in the weeks ahead and advised sellers to appraise and value their vehicles in line with market sentiment.
Simon Henstock, BCA’s UK operations director, commented: “Although October’s figures look exceptionally strong, rising average values are not the whole story. Volumes have climbed in recent weeks and while the best presented and most attractive ready-to-retail cars are selling quickly and often for well above guide valuations, there are increasing numbers of poorer quality cars reaching the wholesale markets. These less attractive vehicles need to be accurately appraised and valued in line with market expectations if they are to be sold first time.”
He added: “Over valuing poor condition and less attractive cars almost inevitably results in a failure to sell first time, taking longer to sale and the potential for holding costs to rise. When buyers have greater choice they inevitably focus on those cars that represent the best profit opportunity in the shortest timescale.
“Sellers should be aware of the changing market conditions and work closely with their remarketing partners to ensure their stock is properly prepared, appropriately condition rated and sensibly valued in the weeks ahead. It is worth remembering that there are buyers for every age, mileage and condition of vehicle providing the price is right.”