Fleets run vans for longer and further than five years ago but are worth more when defleeted, says Manheim

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Fleets are keeping vans for 12 months longer having covered around 8,200 miles more than they were five years ago, figures from Manheim have shown.

Comparing Q1 2015 to the same quarter in 2010, these vans also sold for 9.5% or £384 more.

In the first quarter of 2010, the average van sold was 54 months old, with a mileage of 73,853. It achieved £4,048 at auction.

Fast-forward to Q1 2015, and Manheim’s five-year Market Analysis report shows a 9.5% increase in average value, to £4,432, and significantly increased age and mileage, 54 to 66 months and 73,853 to 82,102 miles.

James Davis, head of commercial vehicles at Manheim, said: “Our latest analysis reveals that over the past five years, despite being a year older with eight thousand more miles, vans have seen their average selling price increase by nearly 10%.

“We’ve also seen between 40% and 50% of all vans sold from the three major volume segments sporting an average age of between seven and eight years.

"We’ve never observed this profile shift previously.

“Small panel van is a revelation all of its own, this segment is now the new workhorse of the van world, stealing the crown from the 3.5t panel van sector. Clearly the influence of older vans in the UK parc will be felt for many more years to come.”

He added: “Our industry experienced a record used van market until 2008, when we entered the sharpest and most prolonged recession in living memory.

“With business confidence at record lows during this period, many fleet operators took the logical decision to extend van replacement cycles, either shying away from committing to new lease contracts or unable to ring-fence suitable lending terms.

“New van registrations collapsed by 40% and that created a perfect storm. For the past two years we have experienced record supply shortages of de-fleeted vans from first life users.

“This five-year report endorses what I have been saying since we exited recession.

"Considering the three largest van volume segments, car derived, small and large panel, back in 2010 their contribution to our overall sold volume was 67%. Five years later it is 81%. Looking forward, this is not bad news for the wholesale market.

“Van values finally reached their glass ceiling in 2014. The SMMT report a steady growth of new van registrations towards the end of the decade; there will be a steady re-alignment of de-fleet volumes over the same period. This will serve to slowly take the heat out of the currently supercharged marketplace and see values re-align by up to 10%.”

Davis concluded: “It is significant to note that, when we reach 2020, the wholesale market is likely to have endured a 12 year ‘shockwave resonance’. It will be the point at which pre-recessionary normality will return, in terms of age and mileage profiles. It’s the most significant scar born from the worst injury to befall the wholesale van market in recent times.”

Car-derived van (Q1 2010 vs Q1 2015)

Over this five-year period, average age increased by 12 months, to 65 months, and average mileage edged up by 3,000, to 73,012.

Despite this, the average selling price of car-derived vans in auction increased by nearly 7%, from £2,854 to £3,045.

Demonstrating the ageing profile, in Q1 2015, 43% of all car-derived vans sold were more than five years old, having an average age of 99 months.

Looking back to Q1 2010, 28% of the total volume of car-derieved vans sold were older than five years, having an average age some 15 months lower, 84 months, than those sold in the same quarter of 2015.

Small panel van (Q1 2010 vs Q1 2015)

Manheim has uncovered a significant profile shift in this segment, the largest observed since reporting began in 2006.

Comparing Q1 2010 to the same period in 2015, the average age jumped 19 months, to 72 months, with mileage increasing 20%, to 81,012.

The average selling price fell against the backdrop of this profile shift, but only by 6%, or £300, to £4,233.

Whereas this segment only contributed 16% of all van volumes sold in Q1 2010, this had jumped to 27% in Q1 2015.

Demonstrating the same ageing profile noted previously, in Q1 2015 more than 50% of all small panel vans sold in auction were older than five years, with an average age of 103.

Looking back to Q1 2010, 38% of all small panel vans sold were more than five years old, with an average age some 20 months younger, at 83 months.

This reflects the significant trends of life cycle extensions and downsizing.

Large panel van over 3.0 tonne (Q1 2010 vs Q1 2015)

More stability is noted in this segment, albeit the average age over the five-year period analysed increased four months, to 57.

The vans sold had travelled 11,221 more miles, achieving an average mileage of 97,235, but despite both increases, the average selling price rallied 33%, to £5,500.

Despite this, the overall age within the sector is still high, with 37% of the vans sold in Q1 2015 being over five years old, averaging 87 months.

Looking back to Q1 2010, 29% of the vans sold in this segment were older than five years, averaging 81 months.

This again highlights the influence of older vehicles in the market; older clearly not equating to cheaper.

4x4 (Q1 2010 vs Q1 2015)

Manheim has uncovered a significant shift in profile in this segment, again the largest observed since reporting began in 2006. Comparing Q1 2010 to Q1 2015, the average age increased nearly two years, 21 months, to 73 months.

The average mileage jumped 21%, to 75,124, while the average selling price increased by 5%, or £360, to £7,451.

Interestingly this segment represented 8% of all vans sold by Manheim in Q1 2010, falling to 6% in Q1 2015.

This reflects the trend of extension for specialist working tool vehicles and the lower volumes of lifestyle model defleets.

Manheim’s ongoing industry analysis has also shown that around half of the 3.7 million vans in the UK vehicle parc are now more than seven years old.

This five-year Market Analysis report entirely supports a further increase in this ageing population; a fact regularly reported in Manheim’s Market Analysis commentary since 2013.

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