Used van values fell by 3.6% (£154) to £,4075 in August compared to July, although performance improved against the CAP average by more than 1% to 99%, according to the latest figures from BCA Auctions.

Compared to last August, the picture is more interesting. Although the average used van value is marginally higher than in August 2011, at £4,075 versus £4,056, the average age is 7.5% higher at 58 months, and the average mileage is 5.6% higher, at 78,167 miles.

In other words, used van buyers are paying more for less, a trend I also reported last month.

The underlying problem is that low new van volumes since 2008 mean that there is a shortage of good quality used stock entering the secondary market. This trend has yet to bottom out, as Duncan Ward BCA’s General Manager – Commercial Vehicles explains:

“The market remains short of good quality, ready to retail used vans, and this is set to continue for some time to come.  Writing in BCA’s 2012 Used Car Market Report, Professor Peter Cooke suggests there is a potential shortfall of some 375,000 first-time used LCVs in the marketplace, as a result of the low new LCV volumes since the onset of the recession in 2008.  The effects of this are already being felt but will hit hardest in 2013 and 2014 when replacement volumes reaching the used market from the fleet and lease sector will be exceptionally low.”

The average also hides a wide divergence between mediocre also-rans and top-quality used models, according to Ward:

“Buyer confidence remains fairly fragile and trade buyers are looking for a quick turnaround and often buying to order, rather than speculating on vehicles. This results in the very best retail vehicles often making exceptional money, while vans in poor condition may struggle for attention. ”

None of this should really be a surprise, as it’s quite clear that UK economy is stagnating at best and contracting at worst. Small businesses of the kind that buy new and used vans will be hardest hit and suffer the biggest difficulties when it comes to cash flow and finance availability, meaning that van replacement cycles will be stretched out as long as possible, especially for non-transport users with low mileage usage patterns.

August is traditionally a weaker month for demand — it will be interesting to see if the trend reverses or stabilises this month, but when cash-strapped buyers are paying more for older, more worn vehicles, downwards pressure on prices is pretty much inevitable.