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Winter warmth in the wholesale LCV market

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Vans waiting for auction

Manheim, a leading provider of integrated products and services for the vehicle remarketing sector, is predicting the UK wholesale van market will superheat through the final quarter of 2018 and that this trend will continue through 2019.

According to Manheim, several factors will fuel a wholesale supply shortage including contract extensions, deferred replacement programmes due to business confidence, extended lead times, roll out of clean air zones (CAZ) and the application of full WLTP and RDE testing. These factors look set to cause a perfect storm for the used van marketplace and drive unprecedented wholesale demand.
Manheim is already seeing growing buyer appetite for Euro 6 vans, in part due to their younger age but also because of their compliance with ULEZ charging zone in Central London coming into force in 2019 and further CAZ charging rolling out across the UK in 2020 and beyond.
September market performance figures from Manheim revealed the increasing impact of this pent-up demand. Average van selling prices were 12% higher year-on-year standing at £6,438, up £14 month-on-month, despite average mileage increasing by 2,500 to 74,114 miles. Average age remained similar, at 57 months.
Coinciding with the end of the holiday period and with schools returning, there was a significant upturn in physical and online buyer audiences as buyers fought hard to secure stock. Reflecting this, Manheim's first-time conversion rates broke all previous records during September, standing at 82.5% - a 4% increase on August.
Exceptional buyer attendances continued throughout the month with over 1,000 individual accounts making a van purchase. A record-breaking 41% of vans were sold online via Manheim's award-winning Simulcast platform, enabling buyers to remain based at their businesses whilst joining the auction action with live video and audio feed. Whilst this buying method represented a significant 5% increase year on year, a staggering 78% of all vans offered by Manheim in September secured an online bid from Simulcast buyers.
Matthew Davock, head of LCV at Manheim, said: "September's performance has broken several records. From average selling price to first-time conversion and growth in online buyer activity, we're proof that the wholesale LCV market remains superheated. We're very encouraged by buyer attendance and activity, and witnessed growing demand for Euro 6 vans throughout the month. We have seen an increasing number of vans sold from either daily rental or SME and sole trader lease finance deal sources. The majority of these were under three years old, in clean condition with great specification so buyers have fought hard to secure these."
Davock added: "Our online buyer base continues to show significant growth. We deliver the largest number of regular online-only special CV auction events for buyers, and the number of vans sold through this channel is up 6% month-on-month. As we move towards 2019, I predict further growth in demand, breaking only at Christmas. With reductions in de-fleet supply beginning to bite, we should experience a superheated van marketplace."

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