Manheim saw average van selling prices pass the £11,000 price barrier in January.
It also saw 23% more volume sold compared to January 2021, as vendors attempted to take advantage of strong price dynamics.
January 2022 marked the return of a five-figure average selling price for a used van, previously observed from June until October 2021. The company recorded another record-breaking average selling price of £11,004 in January. This represents an increase of £2,243 or 26% in the average price of a used van paid, compared to January 2021, when buyers were paying an average of £8,761. Buyers also paid an average of 33% and 86% more on the January averages of 2020 and 2019 respectively.
The average mileage of 79,692 miles represented a year-on-year growth of 2,945 miles. The year-on-year average age increased by one month to 63 months.
The first-time conversion reflected the general tone of buyers throughout January, as six out of 10 used vans sold first time compared to eight out of 10 in January 2021. The percentage of volume sold at auction was 23% higher than the results 12 months ago.
Matthew Davock, Director of Commercial Vehicles at Cox Automotive, said: “On the back of surging new LCV registrations in Q4 2021, this year has started much more positively regarding auction defleet van volumes.
“As a result, I predict used van volumes to be around 15% stronger in Q1 2022 v. 2021 averages. Additionally, the early stages of the year will have a different feel than the relentless pent-up buoyant market dynamics we witnessed over the past 18 months. The market starts to balance out record wholesale price levels versus subdued retail activity being observed and reported in the early stages of January.
“Price sensitivity challenges are evident as van values today are on average 66% stronger than pre-pandemic levels; retail patience and overall dealer cash flow confidence will be crucial for Q1 performances as the market settles into New Year proceedings. Prices will ease in the first quarter, especially in the Euro 5 and higher mileage categories, as more volume hits the wholesale market.”
Van dealers, however, are feeling the effects of the traditionally challenging slower market conditions in January and cash flow dynamics. Consequently, 52% of dealers told Manheim in January that they simply won’t risk stocking too much of the same product, with many adopting the approach of buying stock based on generated leads and not buying for duplicated inventory purposes.
Cash flow continues to put pressure on dealers because of the pandemic, dealers are stocking around 40% less stock on average than in 2019. However, they’re having to spend significantly more for stock today compared to 2019.
Another factor hindering retail conditions and cash flow challenges, is the high price of vans which are dominating retail adverts in the UK. Today, only 10% of stock listed is priced under £10,000 and 71% of stock being listed is over £15,000.
Davock concluded: “I expect the market to continue to perform in February, but market patience will be crucial and retail demand need to improve to ensure the market remains steady and robust. Based on a surge of vans being de-fleeted currently, the overall auction volumes and supply will remain very healthy for at least the first quarter of 2022.”