Fleet News

Fleet News Europe Conference 2004: Measures to save RVs

EUROPEAN fleets should follow a series of measures to help protect residual values.

Delegates were told fleets should predict future residual values for the term of the vehicle contract, set target RVs at disposal time and constantly track and manage residual value risk.

Fleet executives should take several factors into account when tracking residual values, such as new launches, facelifts, market trends, lifecycle influences and changes in new prices.

Car manufacturers can also influence residual values of a car through supply and demand, price/discounts, options, segment allocation, design, and meeting 'customer expectations'.

Martin Verrelli, business unit manager market intelligence for automotive business intelligence company EurotaxGlass's, said: 'There are many different factors that influence residual values. Manufacturers play a big part in future residual values and some are now cutting dealer margins to help stabilise them.

'The design of a car and how it will look a few years down the line is also important and there are now much higher equipment levels in standard cars, which helps.'

In terms of design and customer acceptance, Verrelli cited the Renault Avantime as an example: 'It looked like an MPV but had two doors. It was not accepted by the public and we all know what happened to it.'

Renault scrapped the car in March last year because of low sales.

And it's bad news for European fleets running predominantly white cars - research conducted by Eurotaxglass's shows this colour to be the least popular among used car buyers, although the popularity of specific colours does differ from make to make.

  • For full copies of the Fleet News Europe Conference 2004 presentations in Powerpoint and pdf format click here.
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