If you’re a used van dealer buying vans under two years old at auction, how do you work out how much you should pay?

In theory, you should be able to use trade guide prices. In reality, you need to pay attention to the generous discounts being offered on new vans by manufacturers.

The problem is that your one or two year old van has got to be cheaper than a new van. So the only way to work out how much to pay at auction is to start with the price of a discounted new van and work backwards.

It may sound surprising that you’re able to buy a new van for a price that’s not much higher than the price of (say) a one-year old ex-rental van. But that’s what happens when manufacturers start trying to prop up falling new van registrations.

Auction update

According to Matthew Davock of Manheim Auctions, de-fleet volumes for vans less than two years old reached record levels in January and February, rising by 14% compared to the same period last year.

Davock says that “the majority is ex daily rental” stock and that “the challenge here is guide values”. He says that anecdotal evidence from buyers suggests that auction guide prices are now close to “or even in excess of the deals available on new vans”. Davock says that “buyers value this stock according to the legitimate retail deals online”. I read this as suggesting that the prices of nearly-new vans could be falling.

For older vans, aged two-six years, the problem isn’t price, it’s condition. Davock says that “demand outstrips supply of clean 40-60,000 mile vans” and that there’s been “a noticeable decline in conditions” over the last year.

What’s next?

Heavily discounted new van prices are putting pressure on the prices of sub two year old vans. At the same time, there’s a shortage of good quality vans in the two-to-six year age bracket.

So assuming supply and demand remain fairly steady, what seems likely to me is that used van prices will fall across the board to create a more consistent relationship between age, condition and price. Will this happen? Who knows. Used van prices have been remarkably resilient over the last few months.

Manheim’s Davock expects March to be quieter in terms of new volumes as the plate change period slows the supply of de-fleeted vans. Watch this space for more news next month.