Across the markets used vehicle and asset prices remain stubborn but the signs are there for a dip in demand.
Across the last 2 years used prices have shot up alongside rising costs for new assets too.
Why?
There are many factors well reported so we won’t repeat them in detail. But the main ones below have affected the production of new assets and vehicles.
- The global pandemic
- China manufacturing slowdowns
- The slowdown of exports for all materials including steel and aluminium
- The rising cost of gas
- The rising cost of nearly every other material
- The famous magical “chip” shortage
Put all this together and we have a very large storm in the vehicle and asset market cup.
Alongside the restrictions on the production of new assets, demand from businesses attempting to grow out of the pandemic has put a squeeze on the now reduced supply of assets. Businesses and individuals attempting to source their new car, truck, trailer etc have turned to the used market. This demand and lack of supply has pushed up prices across the board.
Myth busting
Are dealers just making larger profits?
In short – No! Dealers are having to pay more to buy in stock. Manufacturers are paying more to build their stock. Look, there will always be the odd golden nugget for any dealer. But that was the case before the global market demand surged. Those with assets purchased before the pandemic however selling in today’s market, are likely to profit from increased used prices.
Is there change afoot?
Possibly. Various dealer networks, journalists and experts are reporting because of inflation demand has started to slow for used and new assets. CAP HPI has reported a 2.1% drop in used car prices. The biggest drop since earlier 2020. However, most experts warn this is just a minor adjustment and prices will remain high for at least another 12 months. But like anything else in the global markets today; who knows?
If you are looking at purchasing a business asset, give Amica a call to discuss your finance options.
If you are looking at purchasing a new truck or trailer, then call us to discuss our stock or vehicle sourcing options.
01889 221800
