Fleet News

MPV residual fears exaggerated, claim experts

FEARS of a dramatic fall in residual values across the MPV sector are being exaggerated, according to industry experts. Major growth in new registrations, together with a wide range of new entries to the market, have led to predictions that residuals will continue to fall.

Last year 35,579 MPVs were registered in Britain, an increase of 14,462 over 1995, boosting the sector from 1.03% to 1.7% of new car registrations. However, CAP and Glass's believe the impact of this growth will be limited. CAP chief economist Mark Cowling said: 'The initial gut reaction is that the rate of growth we're seeing will be followed by a hefty fall in residuals. But when you put it in the context of the bigger numbers it turns into a mountain out of a molehill. A few years ago people said about 4x4s that there would be meltdown for the same reasons and it didn't happen.'

Glass's Guide chief car editor Alan Cole said potential falls in residuals were initially over-estimated by many people: 'There are more MPVs around now, but as yet they have not come back on to the used market in any huge numbers. Any weakening is probably at least 18 months to two years away and will probably not be as much as people thought this time last year.'

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