Fleet News

Optimism on residuals as pressure mounts on prices

FLEETS are confident that residuals will be protected from a chaotic fall, with manufacturers voluntarily bringing new car prices into line with those in Europe rather than face the embarrassment of Government intervention as pressure mounts over what consumer groups have called the 'Great British Rip-Off'. This week, CAP Motor Research published its first CAP Index, a tracking source for new and used car values, which suggested UK new car prices have fallen 0.4% compared with last September and, for the first time, price cuts now outweighed price rises.

And, amid September's V-plate launch, an opinion poll from the Consumers' Association claimed that 96% of motorists did not think new cars should cost significantly more in the UK than other European countries and 90% believed manufacturers had too much control over prices.

The Consumers' Association is continuing to put pressure on the Government and the Competition Commission's new car pricing investigation for a realignment. Glass's Guide, however, has warned the Government against intervening in the discussions amid concerns that overnight cuts would have a significant effect on residuals.

Nick Salkeld, Lease Plan's commercial director, said: ''If the Government supports the Consumers' Association and demands a reduction in new car prices, we are optimistic the change will come about gradually.' And Bob Rider, managing director, sales, for debis Car Fleet Management, added: 'If re-pricing is managed properly over the next two years, the impact won't be as bad as everyone fears.'

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