How used car market continues to drop

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It was reported by Cap HPI, that prices have slid by 1.9% in May.  Black Book Live reported an average downward movement of 1.9% at 3-years, 60,000 miles in May, with values overall having dropped by 5% since the start of the year. In my previous blog (9th May 2016) I talked about the continual downward movement of the second hand car market and the effect this will have if you own your fleet or indeed have a finance agreement such as Hire Purchase or Finance Lease then this effect is going to have a negative impact when you come to sell your vehicles.  It is worth having a strategy about how you can manage this.

Leasing companies will also start to look to move their RV’s if they haven’t done so already (which would surprise me if they haven’t) and how are you mitigating this with your leasing supplier?  I would recommend that everyone has that open dialog with your leasing company so you understand how they are pricing their assets and the effect this will have on your prices and vehicles that fall in and out of your car policy and grade allowances.

Prices will also look to increase as manufacturers continue to see their exchange rates squeezed which in turn will increase the list price.  So as list prices go up and residual values go down any lease cost or finance package will increase.  It is worth understanding the impact this may have on your fleet and policies.

As we all know, you can look to the Manufacturer to try and support with additional front end discount and then perhaps look at your leasing company and what they are doing to support you and how they pull through the dealer discount so that you get a true cost rather than a fixed discount and the leasing company maintaining the difference.

 

If you have any questions or would like to discuss the above give me a call or drop me a line – 07801472247 – Marcus@puddyvsolutions.co.uk