Used van market bounces as van-makers stumble…

Despite encouraging signs of economic growth in most sectors, the UK car market is still presently stuck in the doldrums. In recent months the government has tried a series of measures to boost ailing UK car dealers and manufacturers. The government’s car scrappage scheme appears to have provided a temporary boost for manufacturers, but retailers are still unsure as to how long the current market buoyancy will last.

Many of Britain’s biggest car and van retailers have struggled over the last year. LDV and the UK vans market has suffered greatly from the global recession. In June, LDV went into administration and over 800 jobs were lost from their Washwood Heath plant, despite several potential investment offers from various parties. Despite the threat of redundancies the government refused to aid LDV due to perceived links between the Business Secretary Peter Mandelson and LDV owner, Russian billionaire Oleg Deripaska.

Earlier in the year it looked like Volkswagen were also struggling, but the latest figures show that deliveries in July were up by 6.7% compared with the overall market slump of 16%. In a reversal of fortunes VW recently announced the takeover of Porsche in a deal estimated at 12bn Euros. The merger came into effect after Porsche racked up massive debts in an attempt to gain 51% of VW in a takeover deal.

Certain areas of the car market are currently doing better than others. The sale of used vans continues to grow according to market statistics, which is encouraging news for re-sellers and used car traders. Scrap yards are also doing well from the government scrappage scheme and from owners trying to find spare parts to fix their cars, rather than fork out for a new one. If the economy continues to rally, it would seem that the majority of the bad times for car manufacturers and retailers are behind them… for now.