figures for 2007 show a 2.4 per cent decline year-on-year in
volumes – the largest annual drop since 2005.
Moreover, it warned, used car dealers should not expect a better
business climate in 2008. “Consumer sentiment remains cautious,”
Experian said.
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Kirk Fletcher, managing director of the automotive division
said: “A slow housing market and the squeeze on spending have left
consumer confidence low and this, in turn, hit the used car sector
hard last year.”
He noted that new car sales – which grew by 2.5 per cent overall
in 2007 – had been better insulated from downward pressures on car
sales during the past 12 months. A strongly competitive market in
which many new models were launched with “discounts and promotions”
had helped stimulate consumer interest, Fletcher said.
In addition, greater green awareness on the part of the general
public – along with rising running costs – meant consumers “will
continue to spend cautiously”, Fletcher predicted.
“Consumers are more aware of the extra costs of running a car
and want more information upfront before making a decision,” he
said.
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By GlobalDataFalling loan values?
Experian found that the age group which recorded the largest
increase in sales – 3.3 per cent – was cars between five and seven
years old.
However, this news could worry motor financiers, as loans taken
out by buyers of older, cheaper cars will be smaller in value than
for younger, more expensive cars. Buyers may even prefer to forego
a loan altogether, preferring to save up money to purchase a
vehicle outright.
Fletcher added: “The popularity of older cars may be linked to
the increasing difficulty consumers are facing when trying to get a
bank loan.”
Motor Finance Issue: 42 – April 08
by Jo Tacon ,
Published for the web: April 23 08 11:27
Last Updated: April 24 08 15:38
