Motor Industry News
June 2012 Used Car Market Editorial
With buyers' minds firmly set on the upcoming holiday season, June is not going to set any new sales records. The trade is still erring on the side of caution when buying anything for stock. Only the cleanest, low mileage cars are generating the interest and bids.
We have definitely seen a shift from the main dealers who were perhaps taking a risk on a 3 to 4 year old car at auction and bringing it up to scratch in their own workshop, only to be hit by a huge bill and having to send it back through auction usually for a loss. They are obviously still buying used cars, but most are to order and from reputable sources. The manufacturer demonstrators are the safest bet for a retailer. Most arrive fully prepared at the dealership which means that the profit margins are set at the time of order. The threat of a sizeable workshop and preparation bill are non-existent. The trade (in general) are still seeking out the low mileage, ready to retail cars. Anything else is really not getting a look in.
The later Corsa SXi models and some ex-daily rental Focus and Astra are proving popular at auction. These are usually in warranty and are a safe bet as a used car. Some ex-fleet, German saloons are also proving popular, often with higher than average mileage. It seems that even today's cash-strapped used car buyers are hugely image conscious. An older, higher mileage A4 or 3 series rather than a newer Mondeo or Insignia seems to be the norm.
In recent years we have seen crippling running costs dampen most Hot Hatchback sales. Golf GTi is still a force to be reckoned with and has somewhat of a cult following, but what does everyone else buy? At one time, a buyer looking for a cheaper Golf GTi alternative would choose between a Ford or Vauxhall. Today we have alternatives. Many manufacturers have been offering Hot Diesel Hatchbacks for some time now, including Volkswagen. They are now fashionable, and as such are the buyers choice. Used values are staying strong as a result. Golf GT TDi, Seat Leon FR and A3 S line up amongst others offer the perfect blend of economy, sporty looks and the performance from a high output diesel engine. It appears that a diesel Hot Hatch is more than acceptable.
Values for June remain pretty much untouched. There is no evidence or need to drop values of clean retailable examples when the shortage of these continues. There are exceptions however with some mid-sized SUVs such as Nissan X-Trial 07 on are down. Big old 4x4s such as Santa Fe and the first of the Range Rover Sports have dropped again by around 2 to 4%. One car to keep an eye on in the next couple of months is Q5. It has enjoyed bulletproof residuals for 2 years plus. The imminent introduction of the facelift version and more significantly the shortened lead times for the current model are sure to have an impact on used values.
VIPDATA is part of CDL Vehicle Information Services Ltd (CDL VIS) the vehicle data arm of CDL Group Holdings Ltd, based in Stockport, Cheshire.
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