Auction Values To Rise In Early 2020?
- December 17, 2019
- Posted by: John Swift
- Category: Automotive Industry
Falling stock levels meeting continued strong demand means that most sectors of the market will see good conversion rates and high prices being paid at auctions as we head towards the end of the year.
In its latest National Association of Motor Auctions says that while there is the usual seasonal slowdown, dealers are still sourcing good stock to open 2020 with. Nearly half of its members expect conversion rates to strengthen, especially for first time presented vehicles.
Values should remain broadly steady overall with most predicting petrol values will increase or remain similar and 75% predicting the same with diesel. Used hybrids and EVs should stay much the same too.
However, good second-hand Euro 6 vans continue to perform strongly and a clear majority of NAMA members say that values will remain steady at best but probably go up. This market has shown strong performance during the year and this should be the case again into 2020. Pre-Euro 6 vans are generally expected to remain stable but over 30% of those responding expect their values to increase.
Louise Wallis, Head of the NAMA, said:
“December is typically a quieter month for auctions with lower volumes of activity. We continue to see demand for good quality vehicles, which with the lower volumes will push conversion rates and values up. NAMA members expect to see a strong used car market in the new year.”
Expect To See A Strong Used Car Market In The New Year
NAMA’s report backs up the latest data from Cox Automotive which also says auction prices at Manheim are being kept high by a stock shortage. It says 87% of vehicles sold first-time last month and with strong competition for younger and fresher, lower mileage cars the average sold price rose by 6% in the month and by 4% year-on-year.
Philip Nothard, customer insight and strategy director for Cox Automotive said:
“Stock has been in strong demand over the last few months and prices have remained high as a result. October saw the highest volume seen all year at Manheim, but the number of vehicles in the wholesale market tends to reduce as we come to the end of the year.
“Usually we’d expect demand to slow down in line with supply, but this year competition for good quality vehicles has remained fierce throughout November.”
Nothard said one factor skewing the stock shortage is the knock-on effect on fleets holding onto their vehicles in autumn 2018 until the tax implications of WLTP became clearer. Now this has been clarified more should be de-fleeted next year and higher volumes should eventually appear at auctions.