Strong sales of new and nearly new vehicles are continuing to reduce the values of older cars, according to Glass's Information Services. The deterioration in prices of cars aged 7-14 years old is being driven by the popularity of younger vehicles, according to Glass's Older Car Guide.
Consumer pressure on manufacturers to lower new car prices in recent years has also reduced the value of used cars. John Glynn, editor of Glass's Older Car Guide, says, "New car price cuts forced used car prices down and, as used car buyers discovered they could afford a newer car for the same money, older car sales were badly hit."
In addition, the growing popularity of niche vehicles, such as compact MPVs and SUVs, has damaged the traditional role of saloon cars as family vehicles. The subsequent drop in demand for average 'D' sector family cars
has led to pressure on older car prices. For example, in March 2000 the Glass's retail price for an eight-year-old Vauxhall Cavalier 1.8 GL five-door was £2,775. In March 2004, the same car at the same age had a retail value of £1,650 - a reduction in value of over 40% in just four years.
Small cars have also suffered. The value of an eight-year-old Ford Fiesta 1.1 LX five-door has fallen 28% in four years.
The Range Rover 2.5 Vogue TDi has dropped 18% in value in the last 48 months.