4WD U-Turn

It is now widely acknowledged that the trade got it spectacularly wrong with regard to used car valuations at the tail end of last year. The demand for used cars did not fall off the cliff and for 4wd’s in general the people in a hurry to trade-out of them – for almost any amount they could get – are now bitterly regretting taking such panic measures. It was hardly surprising however that with the bad news surrounding the economy (and the car industry very much at the forefront of that bad news) that dealers and buyers alike wanted out of the high end SUV’s and would rather put their money into smaller more economical quick turn vehicles.

The irony is that because of the extreme devaluation, some buyers, who had always cherished the thought that one day they could own such a car, could now turn that into reality! We now know, nearly 6 months on, that the decline in values were not real and the used car market in general but this sector in particular has risen to pre-crunch levels and beyond. Indeed MTI actively encouraged buyers to grab a bargain before prices went back up, and in some cases people who bought in December or January and paid the then retail price could actually have run that car for 6 months and got their money back, which, let’s face it, is unheard of with cars that depreciate as quickly and as much as these cars do over a period.

Looking at this phenomenon and how differently this market looks now and how it is still continuing to rise, we have taken 5 popular 4wd’s, looked at what they cost new, what they were worth in blood i.e. the trade would have paid back in December 2008, and finally what they are worth in May 2009.
The results have seen all of them rise in value enormously and with the price of them new costing between £40 and £50k, a year old version can still be bought today for £30k and under, which is still a great saving. But what this survey really shows is that as quickly as prices went into freefall they have just as rapidly bounced back.

Could this be a real sign of recovery?

March – Sept 2008 10k miles on an 08 plate	Make	Model	List Price	Dec 2008	May 2009
	VW	Touareg 3.0 Altitude	£39,000	£20,000	£25,000
	Range Rover	2.7 TD Sport HSE	£48,500	£27,000	£30,000
	BMW	3.0D Sport	£50,000	£32,000	£34,000
	Land Rover	2.7 HSE auto	£46,000	£23,500	£26,000
	Volvo	D5SE Sport	£39,000	£24,500	£27,000