A lack of industry action over creating a van alternative to the used car grading scheme is seeing auction houses develop their own standards.
The used car scheme, introduced in 2012, provides nationally-agreed grades to inform buyers about the condition of cars at auction. It was created by the industry under the eye of the National Association of Motor Actions (NAMA).
However, developing a van grading scheme would involve “a colossal workload for a small sector of the market”, according to Alex Wright, LCV committee chairman at NAMA and managing director of Shoreham Vehicle Auctions.
He said: “I have committee members who are determined to push forward a grading scheme, but the car one does not fit. Therefore, a whole new system needs to be designed for vans at great expense for a small market.”
Asked if a van grading scheme would become a reality within the next two years, he said it was “50:50”, adding: “I have received no request from any buyer in the past four or five years for a grading scheme. Buyer desire and need is not there at the moment and for auction houses ultimately there needs to be a return on investment.”
However, he added: “We are relooking at the whole issue at the present time and it remains an agenda item.”
NAMA’s car grading system uses a scale of condition grades from one to five (or A to E) aligned to defined conditions. Grade one or A describes a car in a virtually ready to retail condition, requiring little more than a valet; grade five or E is representative of a car that has sustained severe abuse with a panel, or panels, needing replacement.
BCA has developed its own online van grading scheme, but said that “gradings for LCVs will differ from car standards, as the industry generally accepts that, by their nature, commercial vehicles are more susceptible to wear-and-tear”.
Simon Henstock, chief operating officer UK remarketing at BCA and vice chairman of NAMA, said: “As part of our commitment to transparency with our customers, we felt it was important to develop a grading scheme for LCVs that would allow for informed decision-making and in support of online channels. While conversations with NAMA are at early stages we are aware that other members are developing their own schemes.
“It is clear that, while the various grading schemes are at different stages of development, it is in the interests of the whole industry that we work towards a national standard. BCA is actively working toward that goal and is a vocal leader in the discussions.”
He added: “It will be important that when we reach agreement on a standard grading scheme for LCVs, it is used by everyone.”
Manheim meanwhile, is planning on developing an LCV and HGV grading system in collaboration with its buyers, which will be integrated into a new inspection system.
“Clearly, every NAMA member can submit their grading solution, allowing the membership to vote on it,” said James Davis, director of commercial vehicles at Manheim.
Barry Watts, group operations director at Aston Barclay, added: “The key for us is to ensure that it’s as simple to understand, adopt and use as the car grading guide, when it is launched.”
Steven Botfield, commercial vehicles senior editor at Cap HPI, said: “A recognised nationwide standard in the commercial van world would be a positive step for the industry and a NAMA-style system would certainly introduce a much needed and more consistent approach to vehicle condition reporting.
“It would also have the added benefits of providing assistance in setting reserve values at auction by the vendor and online buyers would have greater confidence on overall vehicle condition.
“Measurement would also be a key benefit and being able to measure condition on sold and not sold vehicles would be advantageous as would vendor measurement of vehicle condition. It promotes responsible buying and selling.”
However, he added: “The introduction of such a system would not be without its drawbacks.
“The overall cost to the industry would be considerable and would require comprehensive training of vehicle inspectors.
“There would also be the cost of inspections to vendors –would they be prepared to foot the bill?”
Login to comment
Comments
No comments have been made yet.