While reasons for this differ by segment, the firm says the overarching driver is the deferred replacement of vans throughout the recession and post recessionary periods.
James Davis, head of commercial vehicles, comments: “Our latest analysis reveals that over the past five years, despite being a year older with eight thousand more miles, vans have seen their average selling price increase by nearly 10%. We’ve also seen between 40% and 50% of all vans sold from the three major volume segments sporting an average age of between seven and eight years. We’ve never observed this profile shift previously. Small panel van is a revelation all of its own, this segment is now the new workhorse of the van world, stealing the crown from the 3.5t panel van sector. Clearly the influence of older vans in the UK parc will be felt for many more years to come.”
Davis continued: “Our industry experienced a record used van market until 2008, when we entered the sharpest and most prolonged recession in living memory. With business confidence at record lows during this period, many fleet operators took the logical decision to extend van replacement cycles, either shying away from committing to new lease contracts or unable to ring-fence suitable lending terms. New van registrations collapsed by 40% and that created a perfect storm. For the past two years we have experienced record supply shortages of de-fleeted vans from first life users.
“This five-year report endorses what I have been saying since we exited recession. Considering the three largest van volume segments, car derived, small and large panel, back in 2010 their contribution to our overall sold volume was 67%. Five years later it is 81%. Looking forward, this is not bad news for the wholesale market. Van values finally reached their glass ceiling in 2014. The SMMT report a steady growth of new van registrations towards the end of the decade; there will be a steady re-alignment of de-fleet volumes over the same period. This will serve to slowly take the heat out of the currently supercharged marketplace and see values re-align by up to 10%.”
Davis concluded: “It is significant to note that, when we reach 2020, the wholesale market is likely to have endured a 12 year ‘shockwave resonance’. It will be the point at which pre-recessionary normality will return, in terms of age and mileage profiles. It’s the most significant scar born from the worst injury to befall the wholesale van market in recent times.”
