With March well and truly underway many dealers are caught in the crossfire of the car maker’s market share war!
Some of our people are telling us that the targets are not only unrealistic but causing forced registrations as the manufacturers continue to incentivise dealers to pre-register new cars in order to grab more share.
The effect of this for customers is that there are lots of very competitive deals to be had, especially if funding through finance, but also dealers are being forced to try and swell an older profile of used cars as buyers turn away from nearly new and ex-demos.
Of course this has the added bonus that customer part-exchanges are increasing in value as more dealers are looking to stock cars in the 3 to 6 year old sector.
The auctions are also reporting good conversions which you would expect in the new reg month, but it seems the shrinking new car market since the crash has finally started to see less 3 to 4 year old cars coming to market as a knock on effect.
Again customers who own these types of cars need to drive a hard bargain when negotiating a deal and make sure they use all the comparison tools available to them.
We last reported that the biggest factor in selling cars this year will be acquiring your unfair share of prospective customers who, in a recession, are looking for value and many just cannot afford to change or do not have the confidence in the economy to take a chance with a new car.
This means dealers, who in the last few years have relied on internet advertising to market themselves and their products, are now looking to more traditional forms of car advertising such as radio, TV or local papers, this coupled with the essential e mail capture of existing and new customers is driving dealers to heavily promote their brands and drive customers to their showrooms.
The other interesting aspect is how dealers are now looking to market specific cars. For instance the ‘volume’ makes such as Ford, Vauxhall et al have long looked to finance led offers on many of their new cars rather than the headline price of the car and with PCP now clearly the preferred choice of the new car buyer when choosing a new model, seeing an offer of £199 down and £199 per month with a guaranteed future value seems a lot more mouth-watering than £12-£15k as a list price.
These offers are affordable and with less ready cash and disposable income budgeting for a monthly payment and small deposit is far better for many drivers and it is likely that premium brands will also market their cars in this way and you never know you may be able to afford that Golf or BMW you have always dreamed about after all.
This love of credit may also go some way to explaining the way the UK is bucking the Europewide downward trend in new car registrations.