The Gavel - March 2019
Since launching The Gavel at the beginning of the year we’ve been gathering feedback, and we’re making a few changes.
In addition to the usual car auction update from Andy, The Gavel will now also feature a commercial vehicle market update from Matthew Davock, Director of Commercial Vehicles.
The Gavel – Cars
Andy Conde
The wholesale market has been remarkably buoyant over the past month, especially when you consider the external pressures on the industry in general.
Conversion rates continue to be strong and, depending on the product offered, can be anything from 70% to 90%.Our Marshall mega-sale in Bristol was a particular highlight, with over 300 vehicles in one lane and selling in excess of 80%. It was a great case study on how to operate a successful sale, with the vendor on the rostrum reading the market and working in tandem with the auctioneer.
Vehicles offered at Grade 1 and 2 are still making in excess of 100% of Cap Clean.
As I mentioned last time, lower condition vehicles are struggling to attract bids, although some smaller businesses are being forced into buying vehicles that require work or have high mileage as they struggle to compete with car supermarket buyers.
From a fleet point of view, we haven’t seen a big influx of vehicles in the marketplace, and manufacturer sales continue to attract buyers and top prices as the dealer networks search for quality late year used product.
The dealer market is much busier with a big spike in part exchange units.
As London prepares to launch its Ultra-Low Emission Zone we’re seeing an adverse impact on older diesel vehicles in the London area, and in May we’re likely to see a similar picture in Birmingham.
The unseasonably warm weather in February saw an increase in demand for convertibles but this demand has eased now the weather has reverted to the norm.
As always, the Manheim Colchester Thursday evening sale is a beacon for the auction industry with hundreds of buyers fighting to buy hundreds of vehicles, a sight to behold for us auctioneers.
Looking to the future
Despite travelling around 1,000 miles a week I have seen very few 19 plate vehicles on the road which tells me that we will see substantial numbers of pre registrations.
There’s no getting away from the fact that the industry faces some big challenges at the moment. Political uncertainty around Brexit continues to be a millstone around our neck.
WLTP and GDPR are also hurdles that we face, but I believe the used market has the maturity to hold steady - as I stress to all my team, do your best, do the right thing and capture every bid.
The Gavel – Commercial Vehicles
Matthew Davock
The LCV market has remained steady through the early stages of March.
The strong volumes we saw during January and February have slowed slightly and, as predicted, we’ve noticed a softening in the overall de-fleeted numbers.
Looking at it year-on-year, van volume arrival numbers mirror what we’re seeing today, and overall conversion and performance measures are performing consistently well across our eight CV sites and channels.
Getting the most out of the market
Age and mileage have continued to increase in March, and with this we have seen the overall vehicle condition go the same way.
It’s clear that vehicles in poorer condition are more challenging to sell at auction, and both vendor pricing strategy and our CV auctioneering expertise are crucial in maximizing interest and achieving a good conversion rate.
The London Clean Air Zone, and the newly announced TfL scrappage scheme are boosting interest in Euro6 and electric stock among our Southern buyers.
CDV and medium van segment units remain in high demand but large panel vans, Tippers and Lutons have struggled slightly in recent weeks, and the overall condition, mileage and specification remain key.
Online van sales are still growing steadily, and our newly launched Friday online-only LCV event and Enterprise fortnightly Monday events continue to attract high levels of interest.
The ability to buy vans 24/7 adds true value to both our vendors and buyers who regularly tell us that stock quality, availability and auction agility remains key.
Looking ahead
Retail appetite and demand has softened in the early stages of March when compared to January and February.
Several of our buyers are reporting a quieter month, and I expect conditions to hold steady over the coming fortnight.
That said, the general view is that new vehicle registration orders are positive in the main, and volume replacement and de-fleet activity are likely to pick up during April and May.
