Weekly vans update with Matthew Davock - 1st September 2015
Following on from a very strong month of auction performances, the two weeks surrounding the bank holiday weekend are historically known in the van auction world as the toughest of the year. Many buyers either make the most of holiday time before the schools start up or simply put their cheque books away and get ready for the new registration plate change activity. Many believe September 2015 will be a record for new van sales.
Last week we saw strong performances yet again, many auction conversion rates remaining above average for this time of the year. We have seen a downturn of physical buyers with many reporting they are on holiday. Online buyers have however smashed previous records; logging on and buying - even when on holiday! Certain sales have had over 200 buyers logging on. Catalogue views and hits have been very strong. When I reflect on the summertime van market, online is the massive success story. We have broken records left right and centre over this tough period of seasonality. Vendors and buyers have responded positively with performances and conversion rates never before seen.
Buyer feedback on retail activity has been at best mixed, at worst negative. Many reported August has been very mixed… with the first 2 weeks very good. Only a few reported record retail sales during this period. On the flip side the last 2 weeks have been completely opposite; many reporting poor levels of enquiries and sales. Many of the buyers I have spoken to are gearing up for the September rush. For them it is all about preparation of recent purchases and reducing over aged stock.
Nearly new used van stock remains to be a major concern against performance to the guide. This issue is not going away. I would say we have seen record levels of sub 12 month stock in our auction halls this year. To ensure market making success the reserve pricing strategy has to flex from guide; not due to buyer appetite or condition - but actual transaction price of the new vans. The issue stems with the deals on new vans and the differential between new and used making them a value proposition for dealers. Technically it is not the Guides’ fault; they only have MRP to go by and the odd anecdotal comment around actual transaction values. When some manufacturers offer double digit discounts to volume fleets this information never makes it to the public domain. Nor should it! This is balanced with lead times. With many manufacturer lead times extending the demand for nearly new can see premiums be made. In short it needs total understanding to make optimum used values in this marketplace.
September sees more new models being launched; many manufacturers are reporting their desire to hit record levels of registrations. This will impact nearly new auction stock. To give you an idea current auction prices have reported many of these examples performing around the 85% of the estimated guide price. And in most circumstances these are taking 3 sales to sell.
I encourage vendors to price this nearly new stock with caution and take time to look and what deals are available on new and price accordingly from there as we all know 9/10 the first bid is historically the best bid especially on this nearly new stock.
To conclude we are witnessing steady performance. Conversion results have remained above average for this time if the year. Whilst I believe the bank holiday week will be a challenge, Manheim sites are ready for the challenge with its market making teams. We are holding special ‘Bid Weekender’ timed online sales and themed sales up and down the country to encourage buyer participation.
Can you believe we are in September?! Bring on the challenges and opportunities ahead and thank you again for your much valued business and continued support. Tune in every week to see how we’ve performed. Until then, keep ‘Sharing the CV Love’.