Used car values have fallen after the Easter period according to remarketing experts. Both Cap and the VRA reported a downturn in May, both of which blamed an increase in the number of vehicles hitting the market.
Cap said it expected this to be a short-term phase but the VRA said fleets had seen conversion rates fall to around 60-65%. Auction giant Manheim said ex-fleet models remained steady during May, recording only an £8 average price drop month-on-month.
Gavin Amos, head of valuation services at CDL, agreed that values had dropped and also noted an “imbalance” in the usual kinds of vehicles that are making it onto the used car market: “The issue is that demand in the used market doesn’t always match the choices new buyers made a few years previously.
“Because of the disproportionately high number of small cars registered, if you are looking for something with more space then the choice is quite limited, particularly if you don’t want a people carrier or SUV.”
He also said premium brands were becoming less attractive to used buyers because of their surplus and high cost.
“Premium brands have done really well over the last five years, with registrations surpassing manufacturer expectations.
The appeal of a premium brand goes a long way in the new market – they tend to have strong residual values and the monthly rates can be very competitive for lease/contract hire.
However, many used buyers are wary of premium brands because they associate them with higher servicing, maintenance and running costs.”
