Volvo Cars' United Kingdom division has seen used car prices fortify across its range over the past four months after a change in strategy for used car disposal was entertained by the Swedish automaker.
Volvo has traditionally sold all of its six to twelve month old used cars direct to its dealer network through closed physical and online auctions which are run by the British Car Auctions (BCA). Since October last year, the automaker's used cars have been available through the BCA open auction. The new strategy comes with an average of 20 percent being snapped up by purchasers from outside the dealer network.
This positive demand is mirrored in used car valuation guides from both CAP and Glass's. Between December and April 1, records show increases on some models of up to ?900. These notable results have immediately catapulted the Swedish automaker into the BCA's top ten sellers list, with cars in auction stock for just five days on average before they are purchased.
John Wallace, Volvo's Corporate Sales and Leasing Manager, has this to say: "Our recent used car performance demonstrates that second hand buyers clearly welcome the opportunity to buy Volvo used cars and have paid very strong prices."
Wallace added, "The knock-on effect of higher residual values is lower contract hire rates for company car fleets as well as reduced Personal Contract Purchase (PCP) costs for retail motorists. The high speed at which we have turned our cars into cash has also improved our used car bottom line."
Future used value predictions also have showed remarkable improvement. CAP shows that a Volvo S40 2.0D S will achieve a trade value of 46 percent of its original list price after three years and 60,000 miles. CAP also predicted a Volvo V50 Sportswagon 2.0D S at two and a half years and 60,000 miles will achieve 54 percent and that is boding well for the benchmark three year value. The Volvo XC90 retains its strong residual value of 61 percent after three years, 60,000 miles.
The Swedish automaker's used car performance has been reinforced by recent wins at this year's Auto Express Used Car Honours. The Volvo XC90 won the off road 4x4 category and the Volvo V50 and the S60 were both commended in the Estate Car and Compact Executive categories respectively.
The Volvo XC90, which comes as a mid-size luxury crossover SUV, is based on the Volvo P2 platform which is also shared with the Volvo S80 and other larger cars from the automaker. The top-selling car accounts for about 25 percent sales in the United States. This year, the crossover was updated and subtly-restyled to perform and look better. It is equipped with an upgraded , and the 235 hp 3.2 L SI6 straight-6 engine that replaces the 208 horsepower B524T2 straight-5 in the base model.
