Dealers Ditch 4x4s as Values Plummet
Parker’s Car Price Guide has reported “no demand” among used car buyers for petrol 4x4s, especially with V8 engines. Owners of 4x4s are said to be having difficulty entering part-exchange schemes, dealers being unwilling to take on the fuel-hungry vehicles as their devaluation continues.
The issues at hand, unsurprisingly, are fuel consumption and the changing vehicle excise duty (VED); even if auctioned at reduced price, Parker’s claimed buyers would have no interest in buying such high-maintenance cars, which can cost more than £100 ($198) to refuel and £450 ($891) a year in VED.
BCT TRIMS BROKER ROSTER
Nonprime motor finance house British Credit Trust (BCT) has cut its ties with a number of brokers that it deemed “underperforming.”
BCT Chief Executive John Sinclair confirmed to Motor Finance magazine that BCT has terminated its relationship with brokers who failed to deliver “the volume and the quality of business” that the finance house needs.
Sinclair declined to give details of numbers of broker relationships that have been ended for these reasons in recent months.
CAR RETAIL MISERY LEADS TO JOB LOSSES
The U.K.’s largest car retailer Pendragon PLC has announced that it is to cut 500 jobs as a response to “difficult and competitive trading conditions.”
Despite the ominous news in its preclosing statement, Pendragon confirmed that it remained “profitable and cash generative,” with sales volumes remaining “robust relative to the market” and aftersales continuing to perform “well.”
The outlook for Pendragon in the coming months looks gloomy if, as widely expected, the economy continues to deteriorate and car sales continue to slip.
BROKER WINS SUPERMARKET SUPPLY DEAL
One Stop Shop Finance Ltd., a vehicle and asset finance broker based in the North East of England, has agreed a deal with car supermarket Tyneside Autoparc to supply point-of-sale motor finance for all customers at the Autoparc’s 25 individual used-car dealerships.
The new arrangement has been in place since the beginning of June, said Ian Dailey, managing director of One Stop Shop. Prior to the deal with One Stop Shop, the Autoparc retailers had used a variety of lenders.
He said that, so far, everything is going “very well” and reported that levels of finance penetration are far above industry averages: “Of the 600 or so cars sold per month at the Autoparc, we provide finance for about 400 of them.”
USE OF FINANCING TO RISE IN 2008
A majority — 53% — of drivers polled in a survey carried out by car supermarket Motorpoint of Derby Ltd. said they plan to purchase their next car using motor finance.
The results support figures published by the Finance and Leasing Association, which claimed 49% of all new private car sales are now funded by lending from motor dealers — an increase of two percentage points on 2007.
Motorpoint projects sales of 47,000 units for this year.
RBS EXTENDS INSURANCE DEAL WITH CAPTIVE
The insurance division of The Royal Bank of Scotland (RSSI), has won a renewal of its affinity deal with BMW Financial Services, for provision of motor, home, and travel insurance for BMW and MINI (the auto brand owned by the BMW Group) brand customers.
—courtesy of Motor Finance magazine
