October 30, 2014

Don’t turn out the lights just yet

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The pressure is on, there will be fewer people looking to change their cars this year and fewer still looking to change into a brand new car. Buyers are looking for bargains and the thousands of scrappage customers who papered over the cracks and gave the business a big shot in the arm last year are unlikely to re-surface for quite some time.

Analysts and surveys tell us it is the low price, small, cheap to buy, insure and maintain cars which buyers can finance from low return savings investments that people want. This, of course, flies in the face of the evidence so far; although it is wildly acknowledged in this business that if you can’t make money in the first quarter turn out the lights on your way out.

The car business over the last few years has had a habit of proving the experts wrong and although the evidence points towards the aforementioned, car makers and dealers have enjoyed bucking the trend and finding ways of attracting customers to part with their hard earned.

Although early statistics may point towards the obvious in a downturn, try telling that to the Land Rover or Audi sales people who are still quoting 6 month lead times to customers who are carry on signing up and being prepared to wait.

The difference in this market, to perhaps any other in recent history where economic factors have had a big say, is that firstly the products on offer have never been of such quality and had such aspirational value and secondly people no longer view buying a new car as a kind of big life event it has now become simply a way of life. The freedom and enjoyment which comes from the excellence of the models on offer means that buyers look set to defy the doom mongers and continue to buy new cars.

With the battle hardened car dealers refusing to surrender, it is far more likely that all cars will find their own market place and many customers will refuse to compromise on their car choice due to economic reasons. Rightly or wrongly it is far more likely that other things will be sacrificed first.


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