Mannheim predicts part exchange stability
Manheim’s latest monthly UK Market Analysis in 2014 shows that part-exchange values have risen again for the second month in a row, with February witnessing an all-time high of £3,216, which is a £7 increase when compared with the previous month. On the whole, average selling prices have been on a positive trajectory over the past six months, with values rising by £587 over the period. In fact, the positivity goes even further back, as average values in February 2014 are £280 higher when compared with the same period last year.
These figures signal a clear trend and reflect the current strength of the used car market, as values increased despite the rise in both vehicle age from 100 to 101 months and mileage from 76,947 to 77,747 respectively. They also echo the performance in the new car market, which saw registrations rise for the 24th consecutive month in February 2014, according to the latest SMMT data.
Daren Wiseman, valuation services manager at Manheim Auctions, commented: “The strong demand for used cars has continued throughout the first quarter of the year, which has helped keep average part-exchange values high. When you compare February 2014 with previous years, the values have been remarkably strong and I can only see this trend continuing for the foreseeable future.”
Supermini segment leads the way
When looking at Manheim’s monthly barometer in more detail, the average selling price rose for six of the 10 segments covered by the report. The most notable increase was seen in the supermini segment, which saw values increase by 10.7%, which is reflective of a fall in both average age of one month, to 97 months, and average mileage by 2,449, to 55,265.
The supermini segment has also performed well in the new car market, with the latest SMMT figures showing a 16.4% increase between February 2012 and February 2014, thanks to the introduction of a number of new models on the market, as well as a growing number of motorists looking to reduce running costs, factors that also stand true in the used car market.
Wiseman concluded: “It will be interesting to see how the market reacts as we head towards summer. We are continuing to see an increase in the number of vehicles coming to auction following the plate change, while February has seen both the average age and mileage increase. However, the growing volumes have not impacted upon the selling price. This means that there continues to be high demand among buyers for quality used cars and, from what I have seen at the auctions so far in 2014, I would predict that, unless there is a considerable incident on a global scale or the weather in the UK gets decidedly worse, values will remain stable until the summer.”