At 17,562, January 2026 new LCV registrations were down by 1,488 (-7.8%) compared to 2025. They have not been this low since 2008, when the world was hit by the worst global recession since the 1930s, writes Ken Brown, LCV valuations editor at Solera Cap HPI.
You may recall that the recession was triggered in 2007 by the collapse of Lehman Brothers in the US which led to the freezing of global credit markets. This hit new LCV sales because buyers were unable to obtain the finance needed to purchase them.
The current slump in new LCV registrations is largely the result of ongoing economic uncertainty, which continues to affect business confidence. Many fleet operators remain cautious, delaying investment in new vehicles unless it’s absolutely necessary.
The latest outlook for 2026 forecasts 321,000 new LCV registrations, an increase of 1.9% compared with 2025. However, as we saw throughout 2025, forecasts are frequently revised as market conditions change.
For what it’s worth
Given that the UK economy has been stuck in the doldrums for so long with virtually no meaningful growth, it’s reasonable to assume that most new LCV registrations are for replacement vehicles rather than fleet expansion. This dire situation in the new LCV market is multi-causal.
Fleet operators are increasingly deferring vehicle replacements due to a mix of supply issues, escalating costs and uncertainty over the shift to electric vehicles. Many fleets are extending the life of their existing vehicles by trading off the potential increased operating costs and erosion of residual values against the higher cost of replacement.
De-fleets are the lifeblood of the used LCV wholesale market, providing a steady supply of used LCV stock ensuring the market can continue to function. Market prices are established by the collective purchasing decisions of trade buyers. There is a continual dance between supply and demand in the used LCV market and de-fleets are right at the centre of it.
This is a double‑edged sword for the used LCV market. On one side, limited supply allows retailers to push advertised prices higher and potentially increase profit per unit. On the other, smaller retailers’ risk being squeezed out, as limited stock availability and rising buying prices make it increasingly difficult for them to compete with larger dealers who have deeper pockets and stronger buying power.
Views from the block
From our recent round of meetings with the auction houses, the main talking point has been the scarcity of stock. With only the occasional pocket of de-fleeted vehicles coming through, most auction officials we spoke to expressed real concern about current volumes and, importantly, the absence of any signs of improvement on the horizon.
Typical auction sales are marked by fierce competition for low mileage vehicles that require minimal preparation, while higher mileage stock, often exhibiting more noticeable wear and tear are proving increasingly difficult to move.
Why is there such a shortage of stock in the used LCV wholesale market?
History holds the key
To understand why the used LCV market is now facing a severe stock shortage, it’s necessary to look back at the events that shaped the new LCV vehicle market over the past decade or so. The new LCV market reach its peak in registrations in 2016, when 375,687 new LCVs were registered.
The was attributed to solid economic growth, the rapid expansion of online shopping and home‑delivery services. There was also a major shortage of licensed HGV drivers forcing greater use of 3.5t vans for goods transportation.
The market changed dramatically from late 2019 into 2020 as the Covid‑19 pandemic and subsequent lockdowns took hold. By the end of 2020, new LCV registrations had fallen to 292,657 a drop of 73,121 units (-20%) compared with the previous year, and 73,897 units below the pre‑pandemic three‑year rolling average of 366,554.
Registrations recovered somewhat in 2021, rising to 355,380, but this still left the market 11,174 units short of the pre‑pandemic average and it did nothing to offset the 2020 deficit. By the end of 2021, the cumulative shortfall in new LCVs entering the parc had reached 85,071 units.
Then came 2022, bringing the full backlash from the pandemic’s global supply chain crisis. The widely reported semiconductor shortage hit the automotive sector hard, as chip manufacturers had diverted capacity toward consumer electronics during lockdowns.
At the same time, the war in Ukraine disrupted supplies of wiring looms. However, these were only the tip of the iceberg; the most newsworthy issues that dominated the media. Vehicle manufacturers faced material shortages across a wide range of components from many other suppliers that further disrupted vehicle production.
Despite these challenges, 2023 still delivered 341,555 new LCV registrations, but this remained 24,999 units below the pre‑pandemic average. Cumulatively, the period from 2020 to 2023 resulted in a shortfall of well over 100,000 new LCVs entering the UK market. That’s LCVs that never made it onto the road and are now missing from the used LCV stock pipeline.
What the future holds
Looking ahead to 2026 and beyond, the downward trend shows little signs of change. With economic stagnation, high capital costs, and ongoing uncertainty around the transition to electric vehicles, replacement cycles are likely to remain extended and any growth in the demand for new LCVs is likely to be slow.
The result is a used LCV market deprived of de‑fleet volumes, with constrained supply for the foreseeable future. However, history tells us that the used LCV market is resilient and retail demand is unlikely to waver, which can only mean market prices are likely to rise.
Author: Ken Brown, LCV valuations editor, Solera Cap HPI