Air-conditioning drives van values up.

9th September 2019

Light commercial vehicles with air-con outperform those without it on the used vehicle market by a considerable margin in terms of values achieved, performance against guide values and auction conversion rates. 

Values can be up to 40% higher, data published by BCA indicates.

While air-con for cars is commonplace, it remains an option for LCVs and is not widely fitted across the van parc.  However, this makes LCVs with air-con highly desirable at remarketing time.  Values typically outstrip standard vehicles by a considerable distance – well over £1,000 on average, according to BCA’s extensive data.

  • Across all large panel vans sold by BCA last year, vehicles with air-con averaged £6,440, equivalent to 102% of CAP Clean, while those without averaged £5,374 (97.3% CAP Clean).  The sales conversion uplift for large panel vans with air-con was a substantial 15.5%.
  • For small panel vans, vehicles with air-con averaged £7,975 (104.7% CAP Clean), compared to £6,319 (99.3% CAP Clean) – a £1,656 increase in value (over 26%).  The sales conversion improved by nearly 5%.
  • Car-derived vans averaged £4,912 (103.7% CAP Clean) if fitted with air-con, and £3,499 (98.9% CAP Clean) without, a 40.3% increase in value.  CDVs with air-con also saw an increase of 11.5% in conversion rates. 
  • The biggest value differential in favour of vehicles fitted with air-con was seen in the 4x4 Double Cab pick-up sector.  Values increased from £8,783 (99.8% CAP Clean) without this option to £10,514 (101.1% CAP Clean), generating a £1,731 uplift in value and a 3.8% improvement in conversion rates.

Based on the scale charge, a driver paying 20% tax would have a tax bill of just £686 a year, compared to £1,372 for the 40% tax payer.  There is also a flat-rate van fuel benefit charge of £655 for the same tax year.

A comparable company car will have a BIK tax bill many times greater than a van, with only 50% of the VAT on leasing rentals being recoverable and NIC being paid on the vehicle’s full scale charge based on its PIID value.

As a result, some companies may be tempted to “acquire a van and then re-purpose it with rear seats, for example, while still claiming it as a van and paying the appropriate van tax rates”.

“While it is to be expected that air-conditioning will add value in the used LCV market, the real uplift in value now appears to compare very favourably with the front-end costs of specifying this option. LCVs with air-conditioning are highly valued by professional buyers at BCA, because these are the vehicles their retail customers want to buy. These figures underline that up-speccing commercial vehicles at acquisition time can deliver real benefits to van operators. A better specification will make a van more desirable and saleable. For vans that are doing longer distance delivery work, or in a tradesman’s vehicle that doubles as the family transport at the weekend, air-con is exceptionally appealing.”

Jon Gilbert
BCA’s Business Development Director for LCVs