Fleet News

'Urban warriors' take over from luxury cars

'THE large 4x4 used to be the preserve of farmers and country gents. More than any other model, the Range Rover was the one to change people's thinking and become the 4x4 to be seen in. Since those early days of the first large luxury off-roaders many other manufacturers have entered this 'urban warrior' market, some of them perhaps unexpectedly. And regardless of off-road heritage, some have achieved real success in this market.

The BMW X5 is the best example, selling extremely well as both a new and a used car. Mercedes-Benz has always been in the 4x4 market, the once-humble Toyota Land Cruiser is now well established among the luxury brands and Lexus is also doing well with the RX300.

But the king of them all, in many people's opinion, remains the Range Rover. It is now a long-standing joke that car park humps are the biggest challenge faced by these cars but it is a fact that you are most likely to see the luxury 4x4 caked in mud only at the car's launch event. For most of us this is the only opportunity to enjoy the gravity-defying performance on offer and I recommend any off-road novices save lunch until after the demonstration.

But as the luxury off-road market grows, so the luxury sector is bearing the brunt of its success. With sales declining and used demand reducing, this is becoming a tricky market to handle.

On the positive side it is not a bad thing that new registrations are waning because the fewer new registrations, the less risk of over-supply in a difficult used market. Cars such Jaguar XJ, BMW 7-series and Mercedes-Benz S-class all require work to sell to the used car buyer, who is looking for the best mix of luxury and affordability.

If manufacturers of large luxury cars are to continue enjoying any real measure of success, then looking at Mercedes-Benz's experience, having a diesel version is vital. Large petrol engines are becoming a thing of the past and this is reflected by residuals which fall as quickly as the fuel gauge.

So, leaving aside those cars which represent conspicuous contempt for running costs – the likes of Rolls-Royce or Maybach – the new kings of the road are indeed the luxury four-wheel drives.

Don't be fooled by LCV blip

Now, from one extreme to the other. Our Red Book senior editor, David Hill, reports that while the light commercials market is quiet there is still business out there for those prepared to work at it.

Many of the large dealer groups have a policy of writing everything they can off the books by December 31 so they can start the new year with a clean slate. This tends to distort the market briefly by temporarily increasing supply in the open market and these vans consequently tend to be cheap. But this is a temporary phenomenon and should not be regarded as a sustained trend in the van market.'

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