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Vehicle appraisal can never come too soon

Everybody assumes that vehicle condition appraisal only applies to used cars. But I would suggest that appraisal should start even before the car is bought.

We are used to having our ears bent by colleagues in the disposals world. But the situation is worse than normal and that is a sure sign of one thing: the market is struggling and disposal companies are disappointed with current residuals.

So they voice their worries about failing to achieve Cap Clean and imply that our book is too strong. But when investigating we often find Cap Average condition cars with reserves set at Cap Clean.

So I would like to say a few words about the condition criteria which you can find in the front of the book. Cap Clean means ready-to-retail and requiring little or no refurbishment, with all documentation available including full service history. Additionally, Cap Clean cars need to be in an acceptable colour and trim combination. But some of the cars currently being offered at 'Cap Clean' fall well short of the criteria.

As an example, a recent sale included a three-year-old Mondeo, which needed paint on the bonnet in doom blue, and had some service history missing. Certainly not Cap Clean. It might be a bit controversial, but I believe that maybe 50% of cars between three and five years old in open auction could not meet the Cap Clean condition criteria.

But they are still too often reserved as such. Every disposals person should look at their cars in the same way they would if they were the customer. Then they should price each vehicle against the criteria in the book if they are to sell first time. The alternative is to keep putting the cars through the block until you are forced to take lower money.

Dealers don't want to risk giving money for a car that falls short of the criteria at which it is priced for a very good reason. Cars that require investment to bring them up to retail standard are bad news if the job is slow. It could be two or three weeks before the car is fit for sale - by which time the market could have changed.

As for cars which really are Cap Clean, I have seen plenty of bidding wars over them recently, even when the trade was generally slow.

The problem may be most obvious in the executive sector where flat colours, poor specs and bitty service histories are the kiss of death.

I recently saw a black Mercedes S280 with cloth seats and wheel trims at a top car sale: it didn't sell. This is because private people don't buy Mercs like this one. But leasing company customers do, because saving on colour and spec brings it within a monthly payment bracket.

This is why I began by saying the appraisal process should start before the car is even owned. The colour and spec determines its desirability forever.

Remember, most Mercedes-Benz dealers will try to persuade you to choose a good colour and spec because they don't want to bid you where it hurts three years down the line when they bring the car back as a part-exchange.

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