Analysis
Jigsaw Finance’s Nigel Hawkins gives his observations on the PCP market
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The recent performance of the new and used UK car market is being heralded as an indicator to an improving economy. Sales have been attributed to: aggressive manufacturer marketing; competitive low-rate PCP offers; deposit contributions; customers using PPI claims monies; and savings, due to the low return on investments.
However, there are differing views about market recovery. BCA reports average values continuing to rise in the used car market during September, according with both fleet and dealer part exchange values reaching record levels. The used market remained relatively short of stock in September as much of the volume resulting from the September plate change does not impact until early October.
Dealers are holding on to good part exchanges which would normally go to auction in order to offer consumers a good selection. Due to the factors above, dealers are seeing increasing numbers of older cars being used for part exchange as consumers return to the market having held on for better times.
Glass’s says the market figures reveal that while there’s been a considerable increase in the private sector, the business sector hasn’t shown any sign of recovery since the recession began and the fleet sector is performing only marginally better than 2009-11.
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