Buyers favouring petrol
According to Jonathan Brown, car editor at Glass’s more customers appear to be looking for a petrol cars than has been the case in the past couple of years.
Anecdotal evidence also suggests there has been a slight increase in the number of diesel’s being part exchanged by some dealers.
Although Glass’s notes there is not a seismic shift in buying trends at this stage, it seems there has been a public reaction to negative diesel press coverage. A gradual shift away from diesel is expected to continue in the retail segment however fleets, and other high-usage end users, will find it harder to justify such a change in the short term due to the perceived additional cost in fuel of running a petrol model.
Jonathan predicts the knock-on effect will start to be felt, to a greater extent, if small and medium cars with diesel engines become less desirable and values gradually weaken. Petrol variants of the same popular models could however find themselves conversely in greater demand. He suggests the main issue with any such shift, is that a supply imbalance would likely create upward and downward shifts in values.
Glass’s points at how the emerging changes are hard to prove using data alone but looking at recent trade observation data gathered by Glass’s on the C segment, over the course of the last three months petrol values have reduced on average by £199, whilst diesels have reduced by £286. Younger cars (up to two years of age), when sold at auction, the residual values show a more remarkable picture. The average residual value of C-segment petrol cars as at March 2017 was £12,139 or 55.3% of original cost new price compared to diesels at £10,395 (49.5%). Just 1 year earlier (March 2016) petrols were lower at £9,806 (52.9%) and diesels were higher at £10,565 (51.1%).