The figures, based on CAP Motor Research data and adapted to reflect the content and age of the Lex Vehicle Leasing fleet, provide a silver lining to the cloud of heavy residual losses that have dogged the contract hire firm in the past year. Revealing its results as part of the annual figures for parent company Lex Service during the year to the end of December last year, Lex Vehicle Leasing, in which both Lex Service and Halifax have a half share, announced profits of £4 million for 2000, down from £17.6 million in 1999.
Residual value losses jumped from £14 million in 1999 to £25.8 million last year, with profit before disposal losses falling from £31.6 million to £29.8 million in the same period, partly affected by a fall in fleet size of 1,700 vehicles to 91,200 at the end of last year. But Jon Walden, managing director of Lex Vehicle Leasing, said: 'For the first time this month, we have seen an increase in the year-on-year values for an average fleet car. You could never say that this was the end of the crisis, but it certainly could mean that the worst is over.'
In December, £90 million was set aside by parents Lex Service and Halifax to cover expected residual value losses for the next three years. As a result, if the market performs as expected, residual value losses should be zero next year, providing a jump in profits to previous levels. Latest figures from CAP Motor Research also suggest an improvement in the overall used market, with the firm's March index of used car prices showing an average year-on-year fall of 1.3%, compared to a fall of 3.7% in prices in February's figures.