‘Supply constraints’ in ’11

Time 6:47 am, January 6, 2011


SUPPLY constraints will push up trade values in early 2011 according the January edition of Black Book.

The January edition of Black Book reports that December’s exceptionally high auction conversion rates – the month saw rates tipping 90 per cent; a normal average would be 50 per cent – were fuelled by an appetite for stock among dealers.

Latest research by CAP also reveals that stock remains scarce in 2011, and ‘serious buyers’ are already on the prowl.

Black Book research editor, Mark Bulmer, said: ‘Buyers spent December attempting to stock up and this was not only driven by the desire to beat an anticipated January rise in values.

‘There is also a widespread acceptance that buying will need to continue in January and that they will need to pay ‘all the money’ for the best stock because it is so thin on the ground and everyone will be pursuing it. For example, major disposers entered 2011 with significantly fewer vehicles than they began last year with.’

CAP believes that the rest of 2011 will see supply constraints continue, and many dealers will be working hard to avoid low used car stock levels as seen in early 2009.

Bulmer added: ‘In summary, we begin the year with a market which demonstrates some strength but cannot be described as easy. Margins will be under pressure and stock acquisition will prove a headache for many.

‘But for disposers who offer high quality, well prepared stock and dealers who are sufficiently nimble to keep up with both the trade and retail dynamic there will be opportunities for real success.’

James Batchelor's avatar

James – or Batch as he’s known – started at Car Dealer in 2010, first as the work experience boy, eventually becoming editor in 2013. He worked for Auto Express as editor-at-large and was the face of Carbuyer’s YouTube reviews. In 2020, he went freelance and now writes for a number of national titles and contributes regularly to Car Dealer. In October 2021 he became Car Dealer's associate editor.

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