Fleet News

Too many niche models could hit residual values warns Glass’s

Motor manufacturers' increasing appetite to add niche models into the new car market could start to hit residual values, according to Glass’s.

Rupert Pontin, Glass's head of valuations, believes that niches are in danger of becoming the new mainstream and, if this happens, used values will inevitably start to fall.

He said: "This can really be traced to the introduction of the Nissan Qashqai in 2006 when Nissan pulled out of the D sector with the halting of production of the Primera. The move was a huge success and, since then, we have seen a plethora of new niches - all kinds of soft-roaders, coupe-saloons, 4x4 coupes and more. At every motor show we see something different.

"The danger is, we feel, that we are potentially at a point where there are simply too many niches to sustain. You only have to look at the ranges of the German prestige manufacturers, which are running to 20 or so separate models with multiple variants within each range and more planned, to see the potential that exists for confusion.

"The question is whether all of these models add to choice and are understood by the consumer or are really just oddball vehicles that are neither particularly useful nor particularly desirable. Certainly, while we have seen some highly successful new niches recently, other models introduced over the last year appear to us to fall into the latter category and this may effect RV forecasts accordingly.

“Ironically, the C and D sector saloons that were once considered dull are now, in some cases, around in such small numbers that demand exceeds supply by some margin and they move quickly off forecourts.”

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