02 December 2013

Two months after Auto Retail Network reported a brighter outlook for used car PCPs, the subject cropped up again at last week’s Finance and Leasing Association motors conference. It now looks as if they could make serious in-roads into used car finance.

With almost all new car marketing now focusing on the monthly payment, and the fact that this is perfectly accepted by retail customers, I wonder how long it will be before the same applies to used cars.

As several speakers pointed out at the FLA event, an increase in new registrations means that, in two to three years’, these cars will need to be remarketed carefully. One suggestion was for retailers to operate used-car PCP schemes. This is more possible than ever thanks to the quality of car construction leading to better reliability and improved longevity. Couple this to increasingly clever data modeling from the likes of Deltapoint, Glass’s and CAP and a used car PCP looks like a sure-fire winner.

What’s more the depreciation between 3 years and five or six years is far lower than it is earlier, making the proposition even more attractive to consumers.

Now, where do I sign up?

Tags: depreciation, finance, PCP, personal contract purchase plan, used cars