Consumers choosing a new car on a PCP will expect some equity to remain towards their next car when the motor finance term ends.
Research by Manheim showed that 95% of consumers on a PCP are expected to hand the vehicle back and 'trade it in' for a new vehicle on another PCP.
But that 'trade in' is dependent on there being extra value in the vehicle - 80% of consumers expect to have up to 10% equity remaining in the vehicle to take into the next contract.
However, outside Manheim, one used car market analyst told AM there is some concern that consumers reaching the end of the PCP might be disappointed in future after enjoying several years of finance deals that have been very heavily supported with manufacturer contributions.
One dealer group chief recently told AM of a premium brand with a 'negative equity' product because its recent volume push had left insufficient equity in some models when PCP customers were due to change.
Manheim's research showed a third of dealers target 75% of their PCP customers for an early exchange into another car before their plan is reaching the end of term.
"It feels to us that it is under control, dealers can handle the volumes of cars coming back," said Craig Mailey, strategic planning director at Manheim's parent Cox Automotive International.