Continuing strong demand predicted to lead to a record year for used HGV prices

• Record 58% increase in used HGV average selling price
• Demand for Euro 6 HGVs represented a 42% increase
• Euro 5 and older truck product represented 61% of all sold volume
• Stock shortage issues in the truck market mirror that of the used car and van markets

Cox Automotive is predicting a record year for used HGV prices, following high demand for trucks throughout 2021 so far. Following a similar pattern to Manheim’s sales figures for cars and vans, the normal seasonal softening period hasn’t taken place, with strong demand seeing HGV supplies dropping to low levels. Many contracts for fleet volumes have been extended into 2022, resulting in a severe shortage of nearly new HGVs, which are often in high demand leading up to the Christmas period.

Manheim summer HGV auction results

The average selling price of a used HGV reached £13,226 in the summer period, the strongest ever average price on record. The average age of used HGVs was 197 months, and average kilometres was recorded at 189,202 kms.

Chris Mynott, National HGV Manager at Manheim UK, said: “What a summer we’ve had, whilst the weather hasn’t been very warm, the HGV market has been red hot! It truly has been a cracking summer quarter for HGV events at Manheim. Trucks today are making 58% more on average compared to pre-pandemic levels.

“Demand for Euro 6 HGV stock is the driving force behind these great numbers we are seeing. There is such a shortage of late plated or nearly new HGV stock, with build times for new kit way off into the latter part of next year at the earliest; the clamber for this product looks set to continue.”

The desire to own stock has seen individual vehicle type sale prices rocket and for the first time ever, Manheim recorded a 100% price increase for a particular type of truck versus like-for-like in 2020. Euro 6 HGVs represented 39% of Manheim sales, with an average age of 57 months and average kms at 228,000kms. These achieved an average selling price of £18,853, representing a 42% increase versus year-on-year averages.

The reduced number of nearly new HGVs has had a positive effect on the values of older trucks. During this summer, Manheim has recorded Euro 5 and older truck product representing 61% of all sold volume, with an average age of 284 months and an average kilometre recording of 165,573 kms. The average selling price was £9,678, representing a 36% increase versus year-on-year averages. The price difference between Euro 5 versus Euro 6 trucks today, is just over £9,000. Manheim expects this to continue to grow into the last quarter of 2021.

Mynott added: “Older truck values have shown strong performances too, because they look such good value when compared Euro 6 trucks, which are not only harder to source right now, but buyers who really need them are having to pay a premium.

“Overall, the market has performed very strong with 8/10 trucks selling first time, and record prices being achieved. The top three volume manufacturers moving stock through the Manheim digital lanes are Iveco (33%), DAF (18%) and Mercedes (11%).”

Overview of the current HGV market

Like all sectors and markets today, stock shortages are just as apparent in the truck market. Manheim customers have reported volume de-fleet challenges, after further extensions for some manufacturer’s product taking between 12 and 18 months to arrive and showing around a 20-25% reduction on 2019 returns. Many leading HGV manufacturers are reporting full production order bank closures for 2022 already.

Buyer feedback reports also suggest positivity, with many dealers reporting strong retail appetite and conditions. Many buyers are continuing to battle it out to own product and from this, retail price demands are outweighing the supply shortages.

Manheim has also reported a strong uptake of export buyers buying stock in the UK to take abroad. The top three volume buyers are from Bulgaria, Poland and Ireland. Mynott remarks that this shows the UK/European market dynamics are still working positively and showing healthy signs of moving forward, despite concerns surrounding Brexit on imports/exports.

Mynott concluded: “I predict we’re going to continue to see this sort of used stock performance, since there are no signs of any significant volume increases, meaning that buyer appetite will remain strong. Coupled with the pre-Christmas peak demand period, which will be upon us very soon indeed, all signposts are suggesting a record year for used truck prices in the UK.”

Opinion from the view of the commercial vehicle market

Matthew Davock, Director of Cox Automotive Commercial Vehicles, said: “The HGV market continues to show strong market statistics and is following a very similar pattern to the LCV marketplace. The 58% increase in average selling price is record breaking, especially since the used market for trucks has never seen these performances before.

“All supporting industry factors contribute towards these record-breaking results, from manufacturer new stock shortages – to body adapter, build delays, cost increases and the continuing shortage of Euro 6 used HGV stock in the UK today.”

Davock concluded: “Over the past nine months, we’ve focused on supporting our customers. We have had a record breaking sold volume (up 34% v 2019 averages) for HGV sale events at Manheim, and we continue to support our ever-growing global vendor and buyer customer basis in this important market sector for Cox Automotive.

“We currently have the largest dedicated HGV site network in the UK, with seven HGV hubs across the UK and from this, we have supported our vendors by significantly reducing their transportation/CO2 footprint. Over the past 12 months, we have reduced our customers’ collection mileages by 88 miles on average, saving our customers significant logistics costs over this period whilst maximising returns and overall service.”