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UK's potential Pre registration time bomb!
August 2, 2012

The Uk's good exchange rates could mean that we are set for a a massive rise in the amount of pre-registration new cars.

We currently have good exchange rates and this could mean that when manufacturers look for a market to release surplus stock the UK will be an ideal choice.

It is no secret that the motor industry has not had a fantastic time of late. Yes there are manufacturers bucking the trend such as Land Rover who still have exceptionally long waiting times for some of their models, but as a whole sales are down. This means that as manufacturers continue to build cars there will eventually come a time of too many cars and not enough customers.

After all the average length of ownership of a new car has now extended to 63 months. This means that when we do buy a new car we tend to keep them longer. No fantastic news for the motor industry who survives on a stead change cycle. If too many new cars / pre registered cars remain un sold this means that dealers are forced to heavily discount to tempt buyers. 

This in turn can wipe thousands and thousands of pounds off the prices and expected part exchange prices of millions of used cars and send them tumbling down.

Industry insiders are already reporting that some dealerships are already being forced to take more vehicles than they want or need as even the once invincible German car market is showing signs of strain. The UK market has been able to maintain itself to date with a stead stream of vehicle to meet customer demand and this in turn has helped to keep the used car prices and sales steady. A sharp move to over supply could spell dark days ahead.

But would a glut of new car / pre registration vehicles really be a disaster?

Well yes and no.

If you do not have any vehicle to trade in then the chance to buy at a massive discount would be an advantage. If you are thinking of changing your vehicle then while the prices may not look attractive on paper the balances to change should still be better. The real disadvantage is how it would affect the motor industry and used car specialists as a whole as in some cases this could spell wiping hundreds of thousands of pounds off the stock the hold.

So in brief a massive new car pre registration would perhaps not a disaster for consumers but instead be a financial minefield for dealerships, as always why not let us know what you think?


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