The headlines say it all, certain car makers are so desperate to re-ignite their ailing businesses that some cars are now half the price of what they were this time last year. Cars like Vectras, which listed at £13-14000 last year, are now being advertised for less than £6,000! The bigger more fuel inefficient petrol cars are now so staggeringly cheap that even with fuel and maintenance costs they are still a great bargain. Even with manufacturers increasing prices due to spurious currency reasons, it will only make the discounts they are forced to give even greater.
But hold on a minute; lets not get too carried away. Believe it or not there are certain cars that are selling for more as a second hand version than they are new; such is the public perception of nearly new cars being great value. It is still a buyers best bet to do the research, compare prices and make sure the difference between nearly new and brand new are indeed as wide as is being announced. With some great add-ons and even free holidays being given away with some models, dealers and manufacturers are pulling out all the stops to encourage buyers into new cars. Although getting funding is still a challenge with lending criteria still strict there are still some amazing finance deals if you qualify and a dealer we spoke to recently also hinted that more and more customers were looking at the security of PCP packages over traditional HP. Sales of these agreements had increased by as much as 60% against straight forward loans but equally the refusal rates have risen alarmingly.
The banks who created this crisis in the first place are now so scared to lend to anyone that even customers with fairly reliable credit scores are being declined, leaving dealers exasperated in this climate, having worked hard to encourage buyers to use their lending facilities they are falling at the last hurdle. Hopefully help will come with lenders realising that in order to give backing to the industry – as the government has urged – they will need to be sensible with who they lend to otherwise the only people who will qualify for cheap loans will be the very people who pay cash and therefore do not require it.
With all that said the time to buy a car is now, with almost every outlet including brokers, dealers, auctions and supermarkets reporting record sales for used cars, as buyer confidence returns dealers are already telling us that not only are they seeing wholesale prices rise but that more dealers are chasing less quality stock and therefore buyers are having less choice in terms of the exact model and colour they want. This will inevitably lead them exploring the previously unthinkable…a brand new car!