Fleet News

Diesel cars less attractive in used market

New research has found that a typical three-year-old used diesel car will need to be run for a further seven years before the financial benefits outweigh those of a comparable second-hand petrol model.

The news will come as a further blow to de-fleet operators who are already struggling with declining demand for used vehicles as well as an oversupply of ex-fleet cars, especially diesels.

EurotaxGlass’s found that the average three-year-old mid-sized family diesel car currently costs between £600 and £800 more than its petrol counterpart, but the annual fuel bill is currently only £105 less.

Only after seven years will the lower fuel bills compensate for the higher purchase price.

“As well as the prospect of lower fuel bills, some consumers are attracted to used diesel models in the expectation that depreciation will be lower compared to an equivalent petrol car,” explains Adrian Rushmore, managing editor at EurotaxGlass’s.

“However, if the average three-year-old used car was retained for seven years in order to make the most of the lower fuel prices, the premium over a petrol model of the same age might, by then, only be around £100.

“While there is nothing to suggest that prices of used diesels are falling faster as availability increases, clearly the broader financial argument for diesel ownership is becoming less persuasive.

"For diesel cars to remain in favour, they may need to rely more upon driving characteristics rather than any compelling financial considerations.”
 

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