Van at commercial vehicle auction centre

CV update from Matthew Davock - 13th June 2016

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Time is flying by in the world of Manheim Commercials and what a VANtastic start to the year we have had…

In May alone average selling prices were £434 higher (+10%) than May 2015, despite higher age and mileage! This clearly indicates a healthy wholesale van marketplace during a month historically impacted by bank holidays and seasonality.

Year to date the results are even more staggering – average selling prices were £275 (+6%) higher than the same period in 2015 (despite identical age and mileage profiles). We have achieved record-breaking conversion rates for our vendors, selling an average of 81% of their vans first time – a 6% rise from the same period in 2015

Online commercial vehicle auctionWe have seen a record number of online buyers logging on and participating with CV buyer registration numbers up 16% YTD. Nearly three quarters of all vans offered by Manheim so far in 2016 have attracted online bids and a total of 32% of vans have sold via Simulcast – up 7% from 2015.

So, online results and buyer numbers participating in Manheim’s van auctions are at a record high. I believe this has driven an increase in average selling price, as well as boosting strong conversion rates for the UK’s number one CV auction company.

The step change we have seen in online activity this year is nothing short of phenomenal and demonstrates the underlying paradigm shift towards online buying channels. We’ve held a record number of online-only LCV auction and Bid Weekender events for our vendors as well as hosting offsite online sales supported by our unique Mobile Auction Unit.

CV buyers are different and at Manheim we embrace this, we value our buyer relationships. They are based on time spent listening and understanding the CV buyers’ differing needs and requirements. Our CV knowledge and expertise support this and has been the driving force around our buyers’ confidence, trust and loyalty to the UK’s number 1 CV auction company.

In my opinion we are witnessing a new order in the ever changing auction world…. The auction hall buzz is now completely different and I believe the days of seeing 200 buyers rammed into auction halls are behind us.
The new buzz is online and online attendees now outweigh physical buyers; typically 60% online and 40% physical
But this is ever changing. We are in a very healthy marketplace and we are dealing with more commercial buyers than ever before; which is having a positive impact on our average selling price and strong conversions.

Against the backdrop of price increase over the last five months, we have also seen a further increase of duplicate models and poorer condition stock being de-fleeted into our auction sites. As the numbers confirm, average age and mileage is stable but it’s still not shifting back to pre-recessionary figures. I feel this trend will continue throughout 2016.

Many contract hire vendors I have spoken to have confirmed that they are continuing to see a high proportion of customers extending their agreements and some have confirmed this has been ongoing for the past 12 months. On the back of this we have also seen a record amount of higher mileage vans enter our auction halls. When you scan through most auction catalogues throughout the country roughly 70% will show mileages in excess of 90,000 and from this we have seen a slight increase on the amount of damage returning on these vans.

Matthew Davock in the rostrumAs mileages increase and vans are working longer and harder this is not so much of a surprise. The key fact here is around our CV Buyers – over the past 3 years buyers have needed to adapt their buying patterns around what stock to buy and many are finding the need to flex and change weekly. In my opinion the days of the motor trade buyer specialising in sub 50,000 mile vans are diminishing, plus many CV buyers, and an increasing number of car buyers, are now sourcing and stocking a broad selection to maximise retail audiences in all price ranges and budgets.

While there is plenty of buyer demand for late and low mileage vans, the sector continues to be a slight concern in relation to what they are prepared to pay. With tremendous deals on new vans and a growth in online transactions, the dynamics of the way a CV buyer acquires late and low mileage stock has changed. The old world of deciding a bid ceiling based on Guide price then prep cost and retail margin has shifted. Today buyers research the internet to gauge supply then net out their bid ceiling from a retail margin, allowing for whether the van is for stock or bought fulfilling a retail order. Either way the nearly new van auction value has to peg against the new price in order to offer a strong enough value proposition.

What’s hot to the Guide

•    Ford Transit 280 SWB
•    Ford Custom Limited
•    New Shape Ford Connect
•    Nissan NV 200
•    Ford Transit 350 LWB Medium Roof
•    Mercedes Citan
•    Volkswagen Transporter - 140ps with specification
•    Renault Kangoo Maxis
•    Mercedes Sprinter XLWB. LWB (when metallic)
•    Volkswagen Caddy Trendline and Highline
•    Ford Fiesta New Shape

What’s not so hot to the Guide

•    Ford Transit 350 LWB High Roof 11 to 13 plates (up to £1,200 behind)
•    Volkswagen Transporter base specification in white 102ps/84ps 62-15 plates (up to £1,500 behind)
•    Citroen Dispatch/Peugeot Expert 12-15 plate (up to £800 behind)
•    New Shape Ford Transit 350 L3/H3 14-15 Plate (up to £1,000 behind)
•    Old model Vauxhall Astra, Corsa and Combo 10-12 plate (up to £600 behind)
•    12-15 plate chassis cab - Tipper/Dropside/Luton (up to £2,000 behind)
•    Mercedes Vito 12-14 plate (up to £1,800 behind)
•    New Shape Citroen Relay and Peugeot Boxer (up to £1,800 behind)
•    Ford Custom base specification in white (up to £800 behind)
•    4x4 late and low models (Toyota Hilux, Ford Ranger, Volkswagen Amarok, Nissan Navara) 13-15 plates with low mileages (up to £1,800 behind)
•    Old Shape Vauxhall Vivaro 14 plates with up to 20,000 (up to £1,200 behind)

Overall for what’s hot and not, condition plays a major part – but we have seen an increasing amount of model ranges being affected by the replacement of new models, or over a certain period of time models where inflated in the Guide price due to previously being rare and demand was high (for example chassis cab product and 4x4’s).

Ford Transit van at auctionGenerally the feedback from CV buyers remains mixed during May around retail activity and results, like previously stated the buyers who are buying the broad range of stock are reporting better retail results but generally the messages remain positive on how successful the first five months of 2016 have been.

In the coming months, we expect to see the usual seasonality in the commercial vehicle world, with the added extra of the EU referendum and the European football championships. In my opinion, this may have a slight impact on conversion rates, but I believe that our average selling prices will remain strong.

We are about to launch 360° imagery at Gloucester, after massive success and great buyer and vendor feedback at Shepshed – Haydock is next on the list and then the remaining sites over the next 12 months.

With the great strides made and our record-breaking achievements over the past five months, as well as time spent developing and strengthening our CV buyer base, we are in the perfect position to further extend our position as the UK’s number one CV auction. It’s an exciting time to be buying, selling, working and ‘Sharing The Love’ at Manheim!

Thanks Matthew

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