Australian Market Report
Manheim Insights
Q3
Trends for Age, Kilometres and Sale Prices
A car sold
today at
Manheim will
on average have
travelled almost
46,000km more
than a car sold
in our lanes
10 years ago.
F
rom 2011 to 2014, the economic
outlook improved and new
vehicles sales reached record
heights. Private buyers were trading
in their cars and business fleets were
being refreshed in large numbers.
The impact of the extension of vehicle
leases and delaying the purchase of
new vehicles could finally be felt in
the used vehicle market place.
Vehicles sold in 2014 were on
average 61 per cent older than
those sold in 2006. They had 43
per cent higher kilometres. As a result
of the increased age and distances
travelled, buyers were making new
assessments of vehicle’s values.
Despite the average age of vehicles
rising a full two years and the
average kilometres increasing by
almost 30,000 compared to vehicles
in 2006, buyers were still paying
80 per cent of the prices paid 8
years ago.
A car sold today at Manheim will
on average have travelled almost
46,000km more than a car sold in
our lanes 10 years ago. Like our
comparison in early 2015, despite
the fact there have been significant
rises in the average age and
kilometres of the vehicles, prices
paid by buyers have been less variable.
On average buyers are still paying
73 per cent of the value of average
vehicle prices in 2006. While this
might not makes sense at first
glance, there is another factor in play
here; market demand. Picture this.
If most of the cars on offer all have
similar (higher) ages and comparable
(increased) kilometres on the clock,
then buyers are left to compete for
vehicles with similar attributes.
Looking at the results in 2016, the
trends for age, kilometres and price
have continued. Vehicles sold in 2016
are now on average, almost twice as
old as those sold in 2006.
The general nature of the vehicles
being offered has changed over the
past 10 years, which means cars with
higher ages and higher kilometres
are the norm. To purchase these
cars buyers are competing with each
other, which has always been the
case, which ensures pricing is the
one variable which is more constant
than the others.
Their average age is up 97 per cent
compared to 10 years ago. It is a
similar story for average kilometres,
with an increase of 69 per cent for
vehicles sold in 2016 compared to
2006.
So while the relationship between
the variables may seem obvious,
interpreting these results with
a wider economic and industry
perspective can shed some light on
the values over time.
More importantly they can help us
understand the flow on effects of
today’s fleet management decisions
and new vehicle sale have on future
remarketing results.
While it has taken 10 years for
the average age to double, in that
time average kilometres have risen
almost 70 per cent while prices
have fallen only 27 per cent. It will
be very interesting to see how
the trends continue in 2017
and beyond.
Economic comparison of vehicles sold at Manheim
between 2006 and 2016
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