Value of Diesel Cars Continue to Plummet
Recent reports from Cap hpi are stating that diesel car prices are plummeting at a serious rate.
Indeed, the report indicated that prices for diesel vehicles are now declining far faster than petrol vehicles.
Cap hpi reports that a three year old diesel vehicle averaging 60,000 miles have dropped by a staggering 2% in price this month.
So, why such a steep decline?
Whilst many speculate it could just be an anomolous decline for the month of June, others are suggesting that a negative buzz about the fuel type may be causing concern amongst motorists.
Cap hpi believes that values have fallen because of excess stock levels in the wholesale and retail markets, suggesting that prices have therefore lowered in order to be able to shift the abundance of diesel vehicles that motor traders have at their retail outlets.
Mark Lavery, CEO of Cambria Automobiles stated that: ‘customers on forecourts were confused because of mixed messages surrounding the fuel.’
This observation comes after a noticeable switch from long time diesel users form their usual fuel type vehicles to petrol vehicles.
Mark continues to say that: ‘We’re certainly seeing a change in customer behaviour. They’re aiming towards petrol, but in a lot of cases they don’t know why. So you’ve got typical diesel owners doing 25,000 to 30,000 miles a year now converting to a petrol, even though they can have a Euro 6 engine.’
“I think that it’s unfortunate where we are, and a period of calm and consideration, with a clear plan, would be helpful to all parties.”
Cap hpi are suggesting that the decline is not likely to cease anytime soon. In fact, the company suggest that by 2025, diesel vehicle sales will decline from its current standing at half of the new car market, to one-third of the new car marketplace.
Motor Traders working within the Car Dealer sector could now find better profits to be made by trading in petrol engines.
However, Cap also state that the decline may be a natural occurrence, as diesel vehicles had progressively climbed the new car marketplace in the UK over a fifteen year period.
Indeed, the report states that: ‘As diesel volumes decline this will likely support diesel values for a number of years, helping the market manage the shift … In those segments where diesel demand has been weak, we are likely to see diesel share decline or reduce to zero.’
‘For example, in 2016 only 350 City Cars were diesel, compared to 216,000 petrol units. New generation models in this segment will not include a diesel powertrain option in future’.