I
Who determines second-hand car values and how do
they go about it? John Evans meets the people who
decide how much you r used motor is wor t h
PHOTOGR A PHY MAX EDLESTON
“Manufacturers
regularly ask
us to explain
our figures.
I tell them
we’re simply
reflecting the
market”
n a smart office block
in Leeds rest the hopes
of millions of car
buyers and sellers. It’s
he r e t h at e a c h d ay C ap
HPI, the vehicle valuation company,
processes thousands of buying and
selling prices drawn from more
than 50 suppliers, including auction
groups and car sales websites.
The 160,000 motor trade
transactions and 700,000 daily
retail adverts the company crunches
generate 10 million used car values
across 2300 model ranges and in
excess of 70,000 model derivatives
goi n g ba c k 2 0 y e a r s. It c ap t u r e s
price data on two million of the eightm i l l ion u s e d c a r s s old e a c h y e a r i n
the UK. Cap HPI is, it claims, the
country’s biggest supplier of used
vehicle values.
Is there something a bit Orwellian
about Cap HPI and companies like it
t h at c l a i m t o k now w h at y ou r c a r – a
vehicle that’s unique in terms of its
age, mileage, colour, condition, and
service and keeper history – is worth?
Are their valuations a self-fulfilling
prophecy? And, given how crucial a
car’s future value is in determining
its monthly leasing cost, are they
not under pressure to massage their
figures to satisfy car makers and
t he i r ba n k s , at y ou r e x p e n s e?
It ’s t e mp t i n g t o f i nd t he m g u i lt y on
all three counts but with the proviso
that used car prices are, ultimately,
gov e r ne d b y t he l aw s of s uppl y a nd
demand, in addition to other factors,
such as how a model is perceived in
r e l at ion t o it s p e e r s , it s f ue l t y p e a nd
where in its life cycle it is. The clearest
e v ide nc e of t he s e t h i n gs at w ork i sthe auction ring, where Cap HPI, for
example, captures a lot of its price
data and where, on any weekday,
you’ll see thousands of cars sell at
breakneck speed to seasoned traders.
Tr ue , s ome of t he m w i l l b e s t a r i n g
h a rd at t he i r phone s c on s u lt i n g
online guide values, but most of them
already know how much each car will
fetch on the forecourt and, crucially,
what their competitors are asking
for the same models at the same age,
with the same options and in the
same colours. Working back from
t h at f i g u r e g i v e s t he m a n ide a of t he
price they should pay.
The closest that auction bids
come to being manipulated is when
hand-picked examples of a recently
launched model are presented
by a car manufacturer to its loyal
franchise dealers keen to get their
Cap’s Andrew Mee predic
ts future pricing