Dealerships warn that used stock is running short
By: William Hobson
23 November 2010
Logistics work within the UK could be affected by a shortage of retail-able used trucks for at least a year, Road Transport warns.
Speaking to Road Transport, various figures from the dealership and operator sides of the logistics industry have expressed concern that a shortage of used stock could continue for some time.
Jonathan Bownes, sales executive at a Volvo dealership for used trucks in Cheshire, warns that the lack of retail-able used trucks could last between one and four years. He attributes some of the shortage to increased demand from major operators, who are choosing to extend their leases rather than release the vehicles to the second-hand market.
"If somebody with 100 vehicles wants to extend, then that's 100 I can't get my hands on," he says. "The number of lease extensions we're seeing means that we may have no choice but to go out into the market and buy more actively over the next couple of years; at present, we're not active buyers to any great extent."
His concerns are shared by Paul Evans, Iveco's used vehicle operations director. He notes that average lease extensions have risen from two or three months before 2008 to "more like 12 months."
Another factor is that many traditional buyers of new vehicles have turned to used stock, driving demand upwards, says Lee Smith, director of an independent dealership in Essex. "I'm certainly finding that some people who used to buy new are buying used instead," he says. "I'm constantly getting calls from dealers, including franchised dealers, who are trying to buy stock from me."
Demand is also being driven by a recovery in commercial driving work following the recession, particularly among the construction industry.
"Business has really bounced along nicely over the past three months," says Bownes. "I'm getting a really positive feeling about things from hauliers...anyone shifting sand, gravel, and so on seems to have plenty of work on so far as I can see."
According to the sources, if any drivers wanted to sell on their vehicle at any point in the near future, now may be the best time as they can expect to receive more for their vehicle than previously; "As our stock goes down, the prices rise", notes Mr Evans.
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