For regular readers of our Quarterly Reports , you may recall a previous article where we analysed trends for age , kilometres and sale prices in early 2015 .

Given the variable market conditions over the almost two years since we first reviewed the data , we felt it was timely to see how the trends have played out .

We take a fresh look at the story which takes into account full year sales in 2015 and the first three quarters of 2016 .

Whether they are sold at auction or via BuyNow at Manheim , or listed for sale online in CarsGuide or even in a newspaper , car buyers are conditioned to take all three variables into account when determining their view of a vehicle ’ s value .

While the condition of a vehicle , previous ownership , service history , new car affordability and the location of a vehicle are just some of the other factors affecting its market price , the three aforementioned variables no doubt have the greatest impact on the price buyers are prepared to pay .

Economic conditions and industry trends influence the prevailing market in a number of ways . If consumer confidence is low for example , new vehicle buying intention is often affected . Private buyers delay the purchase of a new vehicle , despite the attractive interest rates and great drive away deals , racking up the kilometres and increasing the age of their vehicle before they are finally ready to buy .

Likewise for large vehicle fleets . Events such as the GFC and subsequent periods of economic instability , impacts business confidence and the propensity to invest in new vehicles .

Leases are extended and company owned vehicles are held onto , with the average age and kilometres quickly growing as businesses wait out for signs of economic recovery .

So what happens to the used vehicle market when the economy picks up and consumer and business confidence starts to improve ?

Combine older vehicles with higher kilometres , all coming into the used vehicle sales channels at the same time and price is clearly impacted . How does the market react in this case ? How does this shape the length of time vehicles are kept on fleet or average lease times ?

Looking at our sales data , our analysis was portrayed in the first set of figures we reported on in early 2015 . Using the year 2006 as a base for comparison of these three variables , the average age , kilometres and buy price were assigned a value of 100 .

Combined Trends

Variable 2006 2009 2011 2014 2016

Av . Age 100 % 106 % 124 % 161 % 197 %

Av . Km 100 % 104 % 120 % 143 % 169 %

Av . Buy Price 100 % 98 % 94 % 80 % 73 %

220 %

200 %

180 %

160 %

140 %

120 %

100 %

80 %

60 %

By comparing values from 2009 ( just as the GFC was hitting ), 2011 ( when we were almost through the worst of it ) and 2014 ( economy improving and three years in a row of million plus new car sales ) we could clearly see the relationship between all three .

Now , with the updated figures including 2015 and 9 months of 2016 , we can easily see the trends are clearly continuing . Between 2006 and 2009 , the average values for all three variables were very stable .

2006 2009 2011 2014 2016

As the full force of the GFC was felt in Australia in mid 2009 and 2010 , vehicles starting to come off fleet as the outlook improved in 2011 were considerable older ( up 24 per cent ) and had higher kilometres ( up 20 per cent ).

At this stage the price buyers were paying on average was 6 per cent lower than in 2006 , with the value helped by the relative short supply of used vehicles in the market over the preceding years due to the reasons mentioned earlier . >

Av . Age

Av . Km

Av . Buy Price