Election used car risk
April 6th, 2010 by Richard Aucock
ELECTION fever will reinforce the regular late-spring slowdown in the used car market warns Glass’s.
As buyers become less certain, they curb their retail spending – and this includes cash on new cars.
This means May 2010 could be a difficult month for the UK used car industry.
‘In the weeks before and after the May 2005 general election,’ said Glass’s managing editor Adrian Rushmore, ‘used car sales fell by around 10 percent, and we anticipate a similar lull in 2010.’
This will come on top of the traditional used car lull seen in April and May: over the past 5 years, values typically drop by around 3.5 percent in this period.
The situation will be further compounded in 2010, with the arrival of bumper stocks of PX and defleeted company cars after the March plate change.
‘The market will have to absorb a significant number of part-exchanges and ex-fleet cars in the second quarter, but there will be less dealer appetite to buy them,’ Rushmore said.
‘The relative stability experienced by the market so far in 2010 will soon end.’
As if all that wasn’t enough… those ex-company cars aren’t going to be easy motors to trade, either. ‘It is expected that fleets will be offloading cars that have gone beyond the normal 3 years and 60,000 miles.
‘Given that general market conditions are likely to be more demanding, these vehicles will remain less desirable until the price difference between these and tidier, ready-to-retail units gets much wider.’
Enjoy the current stability while it lasts, seems to be the message from Glass’s…
Tags: election, glass's, government, rv, used