Fleet News

Worst RV performance for years

THE fall of used car values has accelerated with residual values tumbling on average 7.7% this month year-on-year - the worst performance of the secondhand market for many years, according to the CAP Motor Research Index. The residual value fall started around July 1998 and has continued on almost a monthly basis due to a lack of confidence fuelled by rising interest rates and a hold-off because of the Competition Commission Inquiry.

This month the worst affected sectors are executive cars (down 11.3% year-on-year), lower medium (down 9.8%), sports cars (down 9.5%), superminis (down 8.8%), 4x4s (down 7.5%) and MPVs (down 6.5%). But fleet chiefs should not be fooled into thinking the 2.9% year-on-year fall in the value of upper medium sector cars is good news. CAP senior economist Ramesh Notra said: 'The upper medium sector led the decline and prices have now bottomed out.

'Following a strong start to the year, the market has slumped badly. Retail demand has fallen so dealers have little need to restock. This is taking a heavy toll on values.' Although the Index measures vehicles at three years/30,000 miles, Notra said the slump applied to vehicles at three years/60,000 miles.

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