Auction house Manheim’s monthly Market Analysis report
shows that after a relatively strong first quarter of 2008, the UK
wholesale used car market has certainly started to slow down
mid-way through the second quarter.
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Average used car wholesale values in May 2008 were
£6,768, 4 per cent below the weighted average values in
the period January to April 2008. The report said that the changing
conditions are clearly reflective of the broader weakening economic
climate which is now impacting on retail sales, with a direct
knock-on effect through to the performance of the wholesale
market.
As the used car market has hardened, auction conversion rates
have fallen by between 4 per cent and 9 per
cent, depending on the sector, and this is reflected in
auction sales volumes, which are down by an overall 12 per
cent in the month against April. However, it does suggest that
although stocks have risen in line with the downturn, they are
still at manageable levels.
Commenting on May’s report, Mike Pilkington, managing director,
Manheim Auctions & Remarketing said: “There is no doubt that
trade buyers have become much more selective in their purchasing,
aware that there is clearly no shortage of choice. In some cases
buyers are only replacing retail forecourt stock to avoid any
over-stocking, with others still prepared to invest speculatively
in the right vehicles.
“Whilst the overall effect of the surge in fuel and other
motoring-related costs on car purchasing patterns is yet to be
properly defined, the general motoring public is certainly using
this as an opportunity to fully review their motoring requirements.
For example, with diesel prices at the pumps now at least 10 per
cent higher than petrol, we are seeing a rising demand from
trade buyers for small petrol-engine family vehicles.
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By GlobalData“Conversely, whilst demand for most diesel derivatives is still
reasonably strong, there are signs that some of the economic
attractions of this fuel derivative are not what they used to be.
Not surprisingly, prices for the larger-engine executive car sector
– diesel and petrol – are starting to suffer and there is no doubt
that the top end 4x4s are under the most severe pressure.”
A full electronic copy of the Manheim Market Analysis report
can be requested from david.collings@manheimeurope.com
Motor Finance Issue: 44 – June 08
Published for the web: June 11 08 16:53
Last Updated: June 11 08 16:53
