Fleet News

High power: high depreciation

'THERE is often a tendency among manufacturers to make an outrageously powerful version of a perfectly good fleet car. Yet when you think about it, how many of these have ever been truly desirable in the longer term?

Of course there are exceptions, with cars such as the Lotus Carlton and Sierra Cosworth, each based on the regular fleet car, albeit with a few tweaks in the Ford's case. Even so, it was not until both of these cars ceased production that they really made their mark.

Carrying the Lotus and Cosworth names didn't hurt either. Over-powered fleet cars that stoked up little demand have been the general rule however, such as Vauxhall Vectra 2.6 V6, Citroen XM 3.0, Nissan Maxima 3.0 or Renault Laguna 3.0 V6.

Even today, manufacturers continue to produce these high-performers based on a regular fleet car and still they continue to fail. The thinking behind it goes along the lines that public awareness will be stirred by the presence of a 'halo' or 'hero' car sitting at the top of the range.

But these also tend to become the fastest depreciating models in the range and are generally best avoided by any fleet manager. If drivers want something quick then it is more cost-effective to steer them into something that doesn't look like a tarted-up rep-mobile for the best chance of getting a good return on disposal.

There are plenty of cars out there that do boast performance, image and the right look as well as holding their value. They need to have the right pedigree to retain their desirability but even then the relatively limited audience for them means extreme sensitivity to supply levels.

Just a few too many around the trade at the same time can have a significantly negative effect. This sector of the market is finely balanced and too much choice spreads the available customers too thinly for comfort. Even BMW M Sport series or Mercedes AMG and Brabus, which are highly desirable, are subject to similar pressures and once there are even as few as two or three more than usual around dealers become a little uncomfortable.

So what's in a car name?

Some manufacturer names have, over the years, been shortened in common use and mostly with affection. Even some already shortened names – like BMW, from the original Bavarian Motor Works – are subject to this. We now have BMs, Mercs, Rollers, Astons, VWs, Alfas, Jags and so on. But it is noticeable that the majority are brands with the highest image. Imagine walking into the pub and announcing your purchase of a Toy, Cit, Niss or Mit.

Manufacturers often spend a significant part of their marketing budgets trying to educate the public into pronouncing names correctly because names matter.

Hyundai has been trying for the past few years to change the way we say the name and in most cases without success. But does it always really matter?

The fact is that, regardless of how the name itself is perceived or pronounced, Hyundai has won some affection in the fleet market for providing cheaper cars but without a crippling depreciation burden. Surely what matters is that the car is increasingly trusted as a good budget brand. Names matter, of course, but they matter most to those cars with pedigree and there is little reason to expect this ever to change.'

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