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Used LCV prices on track to stay strong in 2020

The used LCV sector had another strong year in 2019, with the outlook for 2020 also positive, according to remarketing specialists.

Aston Barclay says its Leeds van auction returned strong conversion rates and prices during January

Latest figures from both Aston Barclay and Shoreham Vehicle Auctions show another buoyant year for used LCV sales in 2019, with Shoreham data also indicating a strong start to 2020 as London’s Ultra Low Emission Zone (ULEZ) and forthcoming Clean Air Zones (CAZs) incentivise more fleet renewals.

According to Aston Barclay, demand and prices were consistently high in 2019 and while there was a shortage of stock earlier in the year as many fleets extended contracts while Brexit issues played on, this was addressed in the second half of the year, when fleets were forced to dispose of those extended contract vehicles. This contributed to the higher average age and mileage of 70 months and 104,000 miles experienced at auction; the firm added that despite the higher mileage, older ex-fleet stock with a full-service history and in good condition has remained in demand with SMEs.

Geoff Flood, Aston Barclay’s commercial vehicle sales manager, said: “Stock has sometimes been in short supply and average age and mileage has crept up due to Brexit-induced contract extensions.

“The market has taken it all in its stride and demand has remained strong across all sectors of the market.

“Early signs in 2020 are that it will continue, with sales at our Leeds van auction returning strong conversion rates and prices during January.”

Meanwhile, Shoreham has reported a 5.9% increase in year-on-year van sales in January, which it says reinforces that companies are feeling positive about 2020.

“Some fleets have been using Brexit as a reason to hang onto vehicles until they understand how leaving the EU would impact their businesses,” says managing director Alex Wright.

“Those companies will de-fleet their older used vans during 2020 that will help stimulate new van sales and will also provide a welcome supply of used vans to the market,” explained Wright.

“These will complement the newer 12-24-month old used vans that have been coming into the market from rental suppliers for the past year or two.

“A used market thrives on a good cross-section of vans with different ages and mileages, and prices are likely to remain consistent when supply and demand are balanced,” he added.

Wright also cites increased government spending over the next three years as further stimulus for the new and used van markets.

“The growth of large UK infrastructure projects will mean more companies will be looking to grow their workforces and fleets, while sub-contractors will find themselves in demand and will want to invest in a replacement or newer used vehicle.”

And Wright said the last 12 months has seen many SMEs upgrade their vehicles, especially in the south of the country, as more stringent emissions restrictions are introduced for vehicles travelling into London, with additional Clean Air Zones to arrive in coming months.

Panel vans are also being relied on more and more for the last-mile delivery into city centres.

“Now that the Euro 6 standard is coming up to four years of age, these vans are arriving into the used market from leasing companies. They are contributing to a better mix of used vehicles.

“More SMEs will be able to afford a used Euro 6 van which has become the minimum specification for the majority of companies.

“Older Euro 5 diesel vans are likely to remain in demand in rural areas from small businesses.

“With used supply becoming limited as more vans reach the end of their lives, prices are likely to remain strong,” Wright added.

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Written by Natalie Middleton

Natalie has worked as a fleet journalist for 16 years, previously as assistant editor on the former Company Car magazine before joining Fleet World in 2006. Prior to this, she worked on a range of B2B titles, including Insurance Age and Insurance Day. As Business Editor, Natalie ensures the group websites and newsletters are updated with the latest news.

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