Creditplus Blog

Award winning car and finance blog

Why the new car market is in decline

new-car-marketjpg-1

The automotive industry is continuously facing new challenges, and this has recently begun to have a serious impact on the new car market. Recent figures published by SMMT shows new car sales fell to 153,599 units during October, which is almost a 3% decrease compared with figures from October 2017. So, why has this happened?

What's changed?

Brexit is certainly one factor which has contributed to the fall in sales. With so much fear and uncertainty around the future of trade tariffs, manufacturers have cut back their UK investments to protect themselves. In fact, SMMT analysis suggests that EU tariffs on cars alone could add at least an annual £2.7 billion to imports and £1.8 billion to exports.

Another reason behind this decrease, is the looming threat of the diesel ban. The demand for diesel vehicles has fallen, and we are instead seeing consumers move to “greener” alternatives prompting a 30% increase in Hybrid and Electric vehicles since October 2017, according to SMMT statistics.

Demand for used cars

An additional factor contributing to the decline in demand for new cars, is that more and more drivers are now choosing to purchase used or nearly new cars instead, as they are in fact better value. A brand-new car will lose value as soon as it is driven off the forecourt and according to The AA, will have lost 60% of its’ value within the first 3 years. However, a nearly new or used car will have a much slower depreciation rate.

An increased number of drivers are now also moving towards finance solutions as a means of purchasing their vehicle, and finance packages such as PCP and LP packages factor in the depreciation of the vehicle. In other words, if a vehicle has a high depreciation rate, your monthly repayments will be higher, whereas a slow depreciation rate will result in lower monthly repayments. As a result, more individuals are choosing to finance a nearly new or used vehicle as it’s a much more cost-effective option.

Used cars at Creditplus

At Creditplus we want you to feel the excitement of a brand-new car without the “brand-new” price tag. If you choose to opt for a car via our Find, Fund and Deliver service, our team of expert mechanics will perform the necessary requirements to ensure your car is delivered to you in exceptional condition that would look like it was new. But don’t take out word for it, see our customer cars on our Instagram.

Our car supply service includes a thorough RAC 82-point check, a full valet, alloy wheel refurbishment and any needed mechanical repairs. If the car is due an MOT and/or a service, we’ll take care of that for you as well. And if that’s not enough, we also provide free 12 months comprehensive RAC breakdown cover, to give you that extra piece of mind.

We work with a wide network of trusted dealers to help you find your perfect car and secure a finance option which is right for you. Once we’ve found your car and it’s received the special treatment at our PDI centre, one of our Creditplus drivers will deliver your car to your doorstep on the back of one of our transporters.

Apply today and speak to one of our dedicated Customer Advisors about the finance options available to you.

SHARE ON
Related

Leave a Reply

Your email address will not be published. Required fields are marked *