Automotive sector pricing and technical data expert CAP, in association with Sewells, has published ‘Diesel Directions’ which drills into the experience and future expectations of dealers selling diesel in a used car retail environment.
The growth in diesel registrations since 2000/01 has left many businesses exposed to the future prospects of diesel in the used car market.
Because this growth was largely fuelled by tax incentives for company car drivers a question remains over whether there will be sufficient demand among private buyers to soak up increased supply when these vehicles return to market.
Mark Norman, who runs CAP’s future residual values forecasting division, says: “The growth in diesel registrations has created future risk and this research confirms that the supply and demand equation will change. However, there is no evidence that the sometimes predicted ‘meltdown’ in diesel residual values will occur. There are areas of concern, for example, diesel continues to suffer from some negative perceptions among a significant proportion of used car retail buyers.
“However misinformed and arbitrary such beliefs are, they remain a factor influencing choice and are unlikely to change overnight. This means the market for used diesels continues to present opportunities for growth, which could be influenced by carefully targeted marketing.”