VANS will power the recovery in daily rental, epyx is predicting, as overall volumes on its 1link Hire Network platform hit 60% of pre-lockdown levels.
Tim Meadows, Vice President and Commercial Director at epyx, said: “At first glance, reaching 60% may not necessarily sound like a recovery but, during the quietest parts of lockdown, demand was extremely low with only essential services fleets taking vehicles, so we are viewing this as a definite and marked turnaround.
“Volumes certainly appear to be picking up and solidifying, a trend that is being powered almost entirely by vans and other light commercial vehicles as the economy moves into the ‘new normal.’
“Most of the demand now being seen is coming from the types of businesses that have proven countercyclical during the coronavirus crisis, such as home delivery and pharmaceuticals. Rental-wise, these businesses are leading the way out of lockdown.”
However, Meadows said that rentals from other sectors appeared to be gradually emerging as businesses restarted normal activities.
“The picture is, as you would expect, very patchy, but we are beginning to see van rentals from other companies as they return to work and as increasing numbers of staff are unfurloughed.
“Our feeling is that we do not necessarily expect to see an unbroken upwards line in rental volumes over the rest of 2020. It is possible, even probable, that there are some hiccoughs along the way, especially if there are disruptive factors such as more local lockdowns of the kind now being seen in Leicester. However, we are confident that there will be a gradual underlying recovery.”
Meadows added that demand for car hire remained historically low and that there was limited prospect of this changing in the short term.
“The fact is that large numbers of the kinds of employees who would previously have needed rental cars are working from home and dealing with all of their meetings through video-conferencing.
“Until this situation changes, it is difficult to see rentals improving, and that might not occur until there is a development such as a vaccine or effective treatment for coronavirus.”
The 1link Hire Network daily rental platform has been adopted by more than 50 vehicle hire suppliers working with thousands of fleet operators of all sizes across the UK.
The used van market went through the roof during Q2 according to Aston Barclay with prices rising by 20.8% (£1,026) to £5,949 to an all-time record level.
As more dealers chased fewer vehicles in the market, particularly when franchised dealers opened for business on 1 June competition for stock rose dramatically and prices took off.
Between 330 and 360 online buyers were logged on for each sale with all types of vans and chassis cabs finding homes, even a £3,000 van with £2,000 of damage sold above book. The only vehicles that have struggled are 9-seat minibuses as they do not work currently for operators based on current social distancing rules.
Aston Barclay continued to sell used vans online during the lockdown as sectors like home delivery experienced a peak in demand. Those dealers who saw stock depleted during lockdown were then faced with buying replacement stock for more than their original retail sale which has caused challenges on cashflow and stocking strategy.
Double-cab pick-up prices also rose in Q2 by 4.2% (£312) on the back of a marked fall in average age and mileage to 60 months and 65,000 miles. Stock remains in short supply, but replacement cycles are now consistently at five years, which vendors consider as their optimum contract length.
Geoff Flood, Aston Barclay’s national LCV manager, said: “We don’t know when the prices will stabilise, although moving into July prices have cooled slightly as supply has started to improve.
“However, there is likely to be a shortage of stock during the summer as OEMs get production levels back to normal before fleets kickstart their replacement programmes.” h