UK LCV Values At Near Record High, Easing 2022

A report from auction house BCA said it saw Light Commercial Vehicle (LCV) values at near record levels during December 2021 in the UK.

It said there was intense demand in the last two weeks of the year as buyers sought stock: average values were £10,001 (US$13,500), the second highest of 2021.

BCA said that sustained demand for vehicles to service online shopping, home delivery, and the buoyant trade sectors ensured average values remained well ahead year-on-year.

Stuart Pearson, BCA COO UK, said that it was a strong result in a typically quieter trading month. He added: “The LCV boom in values followed the onset of the pandemic with the huge shift towards more consumer-driven online activity. While this may have been expected to dissipate during 2021, values remained incredibly robust with no sign of demand wavering. The bounce-back of the home trade sector continues to fuel values, in spite of well documented supply shortages. 

“With the ongoing pressure on new vehicle supply, there is every expectation that used van values will remain resilient and we are already seeing signs of increasing demand in the early days of 2022.”

Manheim owner Cox Automotive, however, was less bullish about LCV values sustaining at such levels in the year ahead.

The auction house says it is expecting "a tsunami" of pandemic-worn Euro 5 vans to enter the wholesale market in 2022, which will see the market begin to ease.

Matthew Davock, director of commercial vehicles at Cox Automotive, said: “The well-publicized rollout of low emissions zones around the UK will deliver more used Euro 5 vans into the used wholesale marketplace, but at a cost. Despite market softening, buyers will still have to pay higher prices than pre-pandemic levels for "pandemic-worn" vans that have higher miles and lower standards of condition. 

“An increasing awareness of greener, more economical, Euro 6 and electrified vans will be much higher on the priority list of buyers throughout 2022 due to consumers being more educated and aware of the future landscapes and rollout timescales.”

Davock went on to explain that fleet and leasing companies would be de-fleeting non-Clean Air Zone compliant Euro 5 vans as a priority, many of which would have led an extended operating life during the pandemic.

“I imagine these vans will be "pandemic-worn" and have a worse return mileage and condition that will be a concern for wholesale stock quality,” he added.

Other features of the 2022 market, according to Cox Automotive, would be 100,000-mile vans dominating sales, and an increase in seasonality. Wholesale volumes were not expected to increase in the first half of 2022, but in H2 an increase of van returns 25-30% higher than 2021 averages was predicted.