Fleet News

Price harmonisation theory challenged

CAP Motor Research has challenged the view that UK new car prices are coming into line with European prices. The latest edition of CAP Black Book argues that the assumption that one-off discounts - such as those recently offered by Ford on Mondeo - and the launch of special editions at no extra cost do not represent a move towards price harmonisation.

Andrew Wilkinson, CAP publishing director and general manager, says: 'The widespread price realignment theory would hold more water if large discounts and cheap special editions were a new phenomenon, but they are not.'

He said Ford's 'summer offer' price cut was due to a need to clear out non-current specification models and added that, when Vauxhall used old bodyshells to create the value-for-money Corsa Breeze, no one talked of European price harmonisation. This view should reassure dealers worried that the value of used cars on their forecourts would be undermined by plummeting new car prices. 'This is a reminder that they must always buy nearly-new stock wisely,' Wilkinson said.

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