Car remarketing firm BCA has recorded a growth in used car values for the second consecutive month in July 2022.
During the period under review, the used car values at BCA touched £9,464, with values improving by £268 from June, representing a 2.9% increase over the month.
In July, the performance against guide values soared to 97.7%, a marginal increase compared with June, with sold volumes staying roughly the same as the previous month.
BCA UK COO Stuart Pearson said: “July continued the emerging trends of previous months with strong levels of demand for younger, higher-grade vehicles, alongside sustained interest in sports and prestige models, with the particular focus on convertibles that you would expect to see at this time of year.
“There has been a divide forming in the market with the shortage of ex-lease, rental and OEM stock ensuring resilient prices for one–four-year-old vehicles, whilst at the lower end, some of the poorer condition part-exchange vehicles have seen prices drop more dramatically as dealers have concerns over potentially expensive preparation costs and delays in parts supply.”
The wholesale used vehicle market is facing challenges due to the pandemic, and the subsequent supply chain crisis and economic turmoil.
With regard to LCVs, the average values continued to rise in July 2022, recording a growth of 4.2% month-on-month.
In July 2022, their values averaged at £10,220, showing an increase by £420 compared with June 2022.
BCA said that rising demand and buyer numbers were the factors responsible for the growth in average values over the past two months.
Despite promising news on values, the firm has warned sellers that the demand is relatively fragile.
Pearson said: “Given the well documented cost-of-living squeeze and numerous other pressures affecting the wider economy, the LCV sector continues to demonstrate the underlying strength and stability of the used marketplace.”
“Despite the obvious pressures in the used sector, we should expect values to remain reasonably resilient in the medium to long term. The new LCV market fell 20.7% in July, the seventh consecutive month of year-on-year decline as the sector continues to face supply chain issues and long delivery times.
“It means that any business requiring a commercial vehicle at short notice will have to source it through the used sector, which should generate sustained demand and relatively stable pricing in the wholesale markets for some time.”
Earlier, BCA extended its Solifi Wholesale Finance contract.