Average value of used cars increases

The average value of ex-fleet cars sold at auction during October increased 5% from £8,250 to £8,625,  according to The National Association of Motor Auctions (NAMA).

Across the board, average values increased 1.6% from £5,118 to £5,199.

The total volume of sales rose 9.8% from 98,000 units to 107,678 units.

Total transactional activity increased in October across most of the trade market.

Younger to ‘middle-aged’ vehicles (1.6 to 3.5 years and 4.6 to 5.5 years) fell in sales volumes.

However, when compared to the average volumes sold per-category, per-month over the last year, the signs are that September gave exceptional results which were driven by the plate change, and October was settling back to normality.

Price changes October compared to September, by customer type

Across all categories in October, stock has had lower average mileage and age when compared to the previous month.

This has helped augment the strong retail demand for used cars currently being experienced.

All age profiles grew in average price for October with the biggest rise (+13%) seen in the ‘PX profile’ category.

Small changes in price among the segments appear to be correlated with changes in average age and mileage by segment.

Late & Low is particularly sensitive to age, while Budget vehicles display more price sensitivity in relation to mileage.

4x4 and convertible prices during the past three months

October shows that premium SUVs and Lifestyle 4x4s are continuing their climb in price.

As the winter season is approaching, it is increasingly likely that dealers are positioning themselves for the seasonal increase in popularity of such vehicles.

By contrast, prices for convertibles have continued to fall and the fact that volumes have remained stable.

Justin Lane, chairman of NAMA, said: “The early part of the month saw retail demand remain particularly strong across the board to the delight of franchised and non franchised dealers alike.

"However, demand is likely to tail off during the last week of the month with the early part of December remaining quiet before the market picks up once again towards the end of 2013.

“We anticipate that the drop in conversion rates could also be a short lived trend as vendors look to reduce the volume of sale entries and slow defleet activity to avoid any drop in value that may result from over supply. This will probably be apparent until the latter part of December.

“There has been no significant improvement in variety or indeed quality of stock.

"Equally demand, and therefore values, for desirable models or low mileage examples of more prevalent models remain high and these market trends look set to prevail for the foreseeable future”.