The used LCV market is on a roll as fleets switch from buying new to used LCVs, Shoreham Vehicle Auctions (SVA) has reported.
Used LCVs at SVA were sold right up to Xmas with prices remaining strong across December – compared to the usual seasonal decline from the middle of the month – and prices have stayed strong in January with conversions averaging in the mid to high 90s.
The economic slowdown has forced companies to turn to used vehicles rather than sign up to long-term finance agreements for new vehicles, as reflected by new LCV sales, which fell 21% year-on-year in January.
But some fleets also continue to buy used LCVs at auction to avoid increasing pressure from OEMs to order one or more EVs for every 10 new diesel vehicles they order to aid compliance with the UK’s ZEV mandate rules.
SVA managing director Alex Wright said this was a key factor in the strongest December and January he has experienced in his 35-year auction career.
“The demand for used LCVs skyrocketed in December as the economic downturn and uncertainty saw operators buying used LCVs rather than locking into long term finance agreements to buy new vehicles. The gap between the price of a new van and a used van has also reached record levels with many SMEs unable to justify paying £40-50,000 for a new 3.5-tonne van. This is particularly relevant with specialist vehicles such as tippers and dropsides.”
He added: “We continue to welcome fleets to our Tuesday LCV auction who are buying good-quality used vehicles to avoid being forced to buy eLCVs from OEMS keen to meet their ZEV mandate targets. Many fleets are still not prepared for an electric journey as their current usage and mileage sits outside the capability of current electric LCVs available.”
Prices also remain buoyant due to a fall in used van volumes.
Wright estimates the weaker ‘Covid-induced’ new LCV sales in 2022 will leave the market short of between 80-100,000 three-year-old used vehicles in 2025 and in 2026.
“Competition from dealers is forcing up prices, especially for the clean three-year-old vehicles with a full-service history which are less readily available in the current market. We are likely to see a buoyant used LCV market in 2025 and into 2026,” he added.
It’s a big turnaround from 12 months ago; 2024 was a tough year for the used LCV market up until August when the market suddenly woke up.
“The used LCV market was extremely tough for the first seven months of 2024 and finally lower prices and a slowing economy encouraged more dealers to start refreshing their stock. The used market suddenly sprung into life,” said Wright.
SVA also reported the arrival of more electric LCVs on the used market, but the majority are older models with a lower range and slow charging speed and demand has been slow. Some ex-utility Vauxhall Vivaro Electric models and the Toyota Proace with a larger battery have bucked the trend, while sub-£10,000 car-derived vans such as the Kangoo have found buyers.
“The older used electric vans provide value for money for some operators and dealers are willing to give them a chance on their forecourts, but the more expensive vehicles are a much tougher proposition,” said Wright.
