Signs of economic recovery are evident at van auctions, says Shoreham Vehicle Auctions MD Alex Wright
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The most obvious sign that the country's economy is getting back on track comes from the used van market's performance in May.
Publication of June's National Association of Motor Auctions (NAMA) LCV auction data saw the largest monthly rise in vehicle supply for many years.
SMEs that buy used vans to fuel growth in their businesses swallowed up the stock without a problem, reinforcing the signs of recovery.
This is despite the stock getting older and average mileage increasing. Sales of used vans in May increased at auction by a hefty 23% to 7,722 vans and increased in average age (65 months) and average mileage (81,811 miles). These represent a rise of 7.6 months and 7,060 miles respectively year on year. Economic recovery
Alex Wright, MD of Shoreham Vehicle Auctions and chairman of NAMA, says: "The economic recovery is starting from the bottom up, like it did at the end of the 1990s. Small companies are expanding, taking on more customers and more people and buying more used vans to cope with demand. "We know small companies continue to struggle to get
finance approved for new vehicles so they have no choice but to buy used. The way the sector soaked up the huge extra supply of vehicles in May shows that SMEs are expanding, which is likely to be followed by the bigger companies in the next few months.
"We could say that the UK is showing its first signs of properly coming out of recession for good," he adds.
Looking at the May figures in more detail, used prices generally held up well despite the increase in volume, but fell by nearly 4% to £4,322. The average number of days in stock reduced by 2.3 days in May and conversion rates remained at 74%. "NAMA's June figures will make interesting reading on whether volumes remain static as fleets continue to offload their ageing vehicles and demand continues unabated. Whatever happens, I am sticking by my prediction that the economy is starting to head in the right direction," says Wright. •