Fleet News

Stock scarcity makes for a difficult month

'LAST month proved difficult for retailers as the right stock was very scarce, thanks to the lack of new cars registered in August 1999 due to the switch to a September plate change.

It was this shortage that compensated for slow showroom and forecourt activity.

The trade was being ultra-cautious with its buying, just in case auction and leasing company compounds suddenly became flooded with vehicles.

The lack of cars in August is set to continue for the foreseeable future. So, is there an easy answer to this? Probably not, but in an ideal world the industry would get as many cars on sale as early as possible, preferably in August, but still register new ones in September.

Of course, this is very unlikely and it must be very frustrating for disposal managers to know that the trade is crying out for stock one month – while they have nothing to sell – followed by a month when the trade is overwhelmed by choice. What an imbalance! Efforts should be made to plan ways to bridge this gap.

But rental disposers cash in

THE rental disposers also had a good August, but again the trade was buying in relatively small numbers because retailers were trying to keep stock to a minimum, only replacing cars when necessary.

Manufacturers' ex-management, press or fleet cars were easily sold to the franchise dealers, either direct or through other disposal routes and special sales. Prices throughout August remained fairly stable for just about all sectors and there were some exceptionally good prices achieved for certain models. This means anything a little bit different that stood out from the crowd.

However, it was the late plate models that really got the trade to part with their money.

But what happens now? One thing to watch is an upturn in new car bonuses to dealers to make sure they hit their targets at any cost.

Many dealers are reporting that original sales and registration targets are not being met, so the pressure is on to ensure that the promises made to the factories are honoured.

The introduction of new bonus, or increasing existing incentives, can have a knock-on effect on used car trade as dealers find themselves with more nearly-new cars and therefore don't need the stock – or they will only take it cheap. The next month will begin to provide us with a picture of the market ahead.'

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