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February 2009
Manheim Auctions reports January surge in used car demand and prices Used car prices up by 5.8% Conversion rates close to 100% Online sales up by 78%
Manheim’s latest Market Analysis for the first month of 2009 reports a significant increase in used car activity following the Christmas break. Demand and prices have soared beyond the level of any normal seasonal uplift, with record numbers of buyers in the wholesale market fighting over stock. At £6,054, the average wholesale used car selling price was 5.8% (£334) up in January compared with a 3.1% (£185) fall in December. The average selling price increased in all three sectors – Fleet, Dealer and Manufacturer with many of Manheim’s auction centres reporting highest sales levels ever and online sales through Simulcast smashing all previous records. The extraordinary surge in wholesale demand has taken most of the market by surprise and Manheim is still urging caution as retail dealers settle down to the task of finding new customers for this stock. Commenting on the current market, Mike Pilkington, Managing Director of Manheim Auctions & Remarketing said; “There is no doubt that dealers had reduced their stocks pre-Christmas and a lot of this current demand has been driven by the need to replenish empty forecourt spaces. Although there appears to be healthy consumer interest, it remains to be seen for just how long this will be sustained. We have also seen many new trade buyers coming to auction and this has contributed to the huge rise in auction conversion rates and of course the more buyers bidding, the higher the prices.” Manheim’s 19 auction centres throughout the UK have all enjoyed a very strong January. New records have been set in two of the largest sites in Colchester and Bristol where auctions have regularly achieved 90%-100% conversion rates. Colchester smashed the 6,000 sales barrier in a single month, beating its previous record of 5,525 vehicles sold in August 2006 whilst Bristol, with nearly 3,900 vehicles sold, beat the previous best monthly total of 3,230 units sold in July 2003. Simulcast, Manheim Auctions’ online broadcast of physical auctions, has never been so busy with a record 2,100 vehicles sold in January, up 78% year-on-year. The numbers of online bidders often exceeded 100 per sale at several auction centres including Leicester and Coventry. The value of the units sold by Simulcast in January was more than £13 million. In the Fleet sector average month-on-month values rose by 9.0% (£425) compared with a fall of 3.1% (£149) in December, whilst in the Dealer sector average month-on-month values rose by 1.9% (£31) compared with a fall of 4.9% (£82) in the previous month. The Manufacturer sector also saw a month-on-month increase of 3.2% (£284) compared with a fall of 5.0% (£465) in December.
Examples of the increases in average wholesale used car selling prices in January compared with December include the Small Hatchback, Large Family and Soft-Roader segments in the Fleet sector, which rose by 10.6% (£373), 10.5% (£381) and 16.3% (£851) respectively. In the Dealer sector, the Compact Executive segment rose by 8.0% (£182), the MPV segment rose by 7.5% (£148) and the Off-Roader segment increased by 26.2% (£710).
Ends About Manheim Manheim is the world’s largest automotive services company and, through its unparalleled range of products and services, drives every stage of the used vehicle lifecycle. Officially voted Britain’s Best Remarketing company for the last 3 years, Manheim handles nearly 10 million used vehicles worldwide, facilitating transactions representing nearly $59 billion in value. Manheim is a subsidiary of Atlanta-based Cox Enterprises Inc., one of the world’s leading media companies and providers of automotive services. Throughout the world Manheim has over 130 remarketing operations in five Continents, including 38 European locations. In the UK, there are 3 business divisions:
Manheim Auctions & Remarketing: providing a national physical auction network, comprising 19 centres of which 7 have dedicated commercial vehicle activities; a dedicated trade-only direct sales channel; 3 online bidding /sales channels. It includes the brands of Manheim Auctions, VRS and RMS. Manheim DeFleet Services: providing logistics; vehicle inspection; asset management; reconditioning and pre-sale preparation. It includes the brands of Manheim SMART Repair, KAH Systems, Manheim Inspection Services and Manheim Asset Management. Manheim Retail Services: providing retail marketing support including point-of-sale materials; used car stock locators; professional vehicle photography; sales lead management software and aftersales CRM software. It includes the brands of Portfolio, e-GoodManners and Real Time Communications. For further information, please contact: Andrew Andersz JJ (for Manheim Auctions) Tel: +44 (0)1865 343100 Email: andrew.andersz@thejjgroup.com PR012-09