CAP offers its view on the potential impact of 1Car1's 15,000 strong fleet returning to the used market.
Wednesday, April 01, 2009 |
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There is a relatively recent precedent to a large business failure leading to the influx of volume into the marketplace with Rover. In that case the number of vehicles was well in excess of 15,000 but it was managed effectively by the steady dripping of cars into the market over a period, so that the overall supply picture was minimally affected.
It could be argued that additional stock would be welcome in today’s market which has been seeing values consistently rising largely due to restricted volumes available in the open market. And a clear majority of dealers are telling us they are having difficulty at present in finding enough of the right vehicles for stock.
What is unknowable is whether an influx of 15,000 cars and vans into the marketplace would better balance supply with demand or tip the market into an oversupply position, with consequently softening values. At present we would caution against assuming the worst and suggest that much will hinge on how well this is managed.
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