Second
by ISLA CAMPBELL
The credit crisis, rocketing fuel prices and swingeing tax increases imposed by the Chancellor in the name of environmental protection have had a significant and detrimental impact on the price of second-hand motors, wiping an estimated ?2billion off the value of the market over the last six months.
However, it may get even worse as the Vehicle Excise Duty increases are yet to make a full impact. It is already clear that vehicles that emit the most CO2 are the ones seeing the largest comparative percentage falls in value. The 4x4 market in particular is expected to decline over the next year as potential buyers shift their desires to vehicles that are more economic, and perhaps a lot smaller.
Because of the government��s current determination to heavily tax cars based purely on their CO2 emissions, even relatively efficient cars with bigger engines are falling victim to the higher VED increases. The flip side of that means that only small cars are likely to comparably maintain their values, as they are considered to be easier to sell on in the current economic climate.
The really big losers in the rapidly declining values of second-hand vehicles are those who have recently bought brand new, so-called ��gas guzzlers��; the value of their acquisition dropped the instant they drove it off the forecourt, but now re-sale values have fallen further than mere depreciation following the chancellor��s announcement of the VED increases.
However, despite plummeting prices the average car dealer in the UK is expected to see little impact on their revenues. Even though sales values have dropped, and so in turn has the cost of acquiring those cars. Car dealers will be able to assess the CO2 emissions of any vehicle and its tax liability before buying them. This will allow them to simply maintain the margin between the cars they accept in part-exchange or acquire from other dealers, and the price at which they sell them.
So, the real advantage will go to those who are looking for a second-hand bargain and have cash to spend. They are likely to be able to negotiate down an already low price, and could bag themselves an impressive bargain. Those who are relatively well-off can acquire a nearly-new 4x4 for a lot less than they would have paid at this time last year.
But, the majority of UK car owners are consigned to watching the value of their asset fall a lot quicker than they bargained for!
Isla Campbell writes on a number of topics on behalf of a digital marketing agency and a variety of clients. As such, this article is to be considered a professional piece with business interests in mind.
