Originally Posted by
TKH
So having been in the motor industry 32 long years (soon to be out) it was increasingly obvious back in 2006 that things were changing and not in a good way.
I was Vauxhall’s at the time and they launched daft schemes like £99 deposit 5 year finance with free insurance as you can imagine the youth rolled in for new Corsa SXI’s, 12 months later they could not afford the next years insurance and lots got repoed.
With PCP we were getting people in with offers on same product we could not get close too, then we saw why unscrupulous sales people at let’s say larger outlets were manipulating the residuals by pretending people were only going to do 5000 miles pa not 12000 this bumps the balloon up and reduces the monthly they do the deal 3 years down the line a 36000 mile hand back ain’t worth the same as a 15000 miler and big negative equity issue, the salesman or BM is long gone.
The FCA have just launched an investigation into Lookers for miss selling PCP their share price has tanked 25% this week
And check out Pendragon (Evans Halshaw and Stratstone) share price down 30% in a week after admitting 38% of their used car stock is pre reg from last year or 177 million worth.
Manufacturers are driving dealers to despair with ever higher targets making them do crazy stuff to survive, the whole business model is fatally flawed and ready for a errrr correction I think you call it.
The other thing that’s changed is the yoof, for years a 1st car was a 10 year old Corsa, Fiesta or Polo etc for £1000 that they could knock the corners off in their 1st year and learn the value of looking after something.
Not today oh no that’s not going to work out for the little prince and princesses, we had mums and dads bringing in their cherubs, trying to placate them with a Brand new Fiesta for £14000, but I want a Mini or an A1, Zoe’s got one Fiestas are rubbish (discuss), and they would strop until they made there parents walk apologising.
These are kids often have no income nor prospect of given their outlook and expectations and their parents are paying for 3 or 4 cars plus insurance it’s utterly mental, why can’t people just say NO, the best excuse is it’s so I know their safe in an A1, A Class or Mini and the kids play on this, I despair a10 year old Corsa, Polo or Fiesta is perfectly safe.
The other issue is brand desire Audi, BMW, Mercedes and VW are now the volume brands they are growing at a prodigious rate as buyers want premium brands to drive and be seen in and I get it the problem brewing is when they all collectively hand them back in the not too distant future oversupply will batter residuals and that is when the shit will hit the fan big time.
Since the crash 10 years ago interest rates have been kept low which is good and bad depending on your viewpoint or position, however what it has meant is the personal debt figure is significantly more than it was pre crash.
I read the other day a sob story that today kids can’t get on the property ladder because they can’t raise a deposit which was easy for us born in the sixties ,seventies and eighties.
If you live with your mum and dad your outgoings should be minimal, oh and you should pay keep.
But kids today have a car payment £200 mobile £50 gym £50 nails £50 and seem to eat out or have takeaways every other night and that’s before you start on fashion spend.....buy a 10 year old car outright do your own nails learn to cook get a sim only contract and buy an out of date phone.
Shit I’m old just turned 50 and do not understand anything anymore.