Fleet News

From money-maker to run-of-the-mill

##CAPsml--left####Martin Ward--right##JUST a few short years ago, a Mazda franchise was like having a licence to print money. The model range was second to none, as was the quality. It had brilliant customer satisfaction, residuals that were the envy of the industry and most importantly an image and desirability of product that turned other importers green.

So, what went wrong with the model line-up and caused the negative reaction by most of the industry for the past couple of years to the marque?

Mazda started playing it safe, by introducing cars that were regarded by most, including dealers, as boring. They went from being innovative with design to being run-of-the-mill, or worse. Remember the 323 with pop-up headlights, and how well it was received all those years ago? The 626 that was introduced in 1992 was a revolution, and well received by the public and fleet users alike. The fleet manager could put a Mazda on the fleet and would know it was a sure bet when it came to disposal time.

But now Mazda has temporarily lost its way, with dealers complaining and struggling to sell the current range of cars. They are also struggling to make profit, in what is a very competitive market. At one stage recently Mazda had become a one car franchise with the MX-5, and although this has always done well and continues to do so, there is a lot of competition now in the two seater sports car market.

When the current importer, Mazda Cars (UK) Ltd is taken over by Mazda Motors UK, it is hoped that it can once again get back on track and introduce some new cars that both fleets and private owners can once again be proud of, and be envied by other drivers.

September new car shortage

Most dealers are reporting a general shortage of new cars available for September 1 delivery. This is causing problems for the valuation of the part-exchange, as any extended period of delay has a ripple effect on the used car's value.

If the new car is guaranteed to be delivered in early September, then the price at this stage is relatively easy to predict, as it is just a few weeks away. But the longer it goes on, then the more difficult it becomes, and the more chance there is of getting it wrong.

The further into autumn it gets the less desirable the used car becomes and the value will of course drop accordingly. This is also relevant to the fleet industry because any extension to a contract, particularly at the back end of the year, can cause financial burdens. There is only one way values can go at that time of year - down.

September has been forecast to be a massive month for new registrations, with an unprecedented number of used vehicles hitting the used car market. Any that come into the market late, in October or November, could have missed the party by then.

Manufacturers are doing all they can to ensure adequate production and keep to delivery times, but with the best will in the world and the summer factory shutdowns, it is quite possible that things will go wrong, to the cost of an already delicate industry.

Setting sensible reserves

With a further softening of prices, auctions are still managing to sell around 70% of entries first time. This good effort is mainly due to disposers continuing to ask sensible reserve prices and making adjustments for the condition of the vehicle, and not being too greedy on the entry form.

It is important to assess each vehicle individually and if this is not logistically possible, then to accept an independent assessment, or the auction's condition report. We may sometimes feel badly done to in the UK but spare a thought for our European counterparts who do similar jobs, be it in fleet or retail. They have to suffer one particular problem to a much greater extent than we do, and that is the summer break.

Virtually the whole of Europe closes down between now and the end of August with very little business being done. A bit like last year in the UK motor industry! However at least customers are still back on the forecourts and things are ticking over nicely.

FNN allows you to search for REAL prices reached by REAL vehicles sold at the country's leading car auctions. To start your search click here.

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