Looking back through some records the other day we realised that its never been as cheap to buy a used or new car.
Yout typical 2 year old car (Avensis in this case) has dropped about £3000 since March,
simlair price drops on Corolla and about £2000 ish for a Yaris, Landcrusiers are off the scale.
The intersting thing is though the older cars have not dropped as much so any PX wont have taken as much of a pasting.
Not looked at other makes but more than likely the same story.
As for new cars these have never been as cheap to buy, we found a 1992 Ford price list and the base model Fiesta was £6500 fast forward 16 years and you can have a new Aygo for about the same..... the average wage has probably doubled in the same time period.
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I wish this effect would hurry up and spread through the rest of Europe. Poland and Germany are still paying silly money for cars. I can't see it ever happening though.
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Now I am stuck with a 4X4 that dealers would offer very little for. Thus the cheaper cars in their show rooms are still out of reach as far as a swop goes because the drop in the value of mine wipes out the benefit of their falling prices. I would think only those handing in something a dealer is happy to have and taking something the dealer would be glad to see the back of are the ones making the biggest savings.
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Poland and Germany are still paying silly money for cars.
Any idea why that is? Colleauges here from Finland and Germany were astonished at how cheap used cars are in the UK.
Same thing seems to happen even in the US, yet they have very low new car pricing.
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>>Any idea why that is? Colleauges here from Finland and Germany were astonished at how cheap used cars are in the UK.
Supply and demand.... but will change soon ... even over there things are tough for the motor trade ... the biggest group over in Checz and Poland is having a tough time.
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I bet that almost any car you can buy today will be cheaper in the first 3 months of next year!
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I defer to the superior knowledge of our "Leader"!
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I cannot comment on new cars but HJ's comments sound in line with Sony on TVs raising prices 25% from January 2009.
On second hand cars I recall the 1979- 82 recession. Second hand cars of that era were few and far between afterwords and when things improved, prices hardened.
But - and here is a big but- we are likely to be in the worst recession since WW2, worse than 1972-74 - although not as bad as 1929 (I hope .. but we could get that bad..)
So secondhand prices still do not reflect the oncoming 1 million plus people becoming unemployed who will HAVE to sell their cars to raise cash and because they can no longer afford to run them.
And the second cars being sold for similar reasons.
And as credit on credit cards dries up and car loans become more difficult - anyone who thinks the credit crunch is over is an optimist - sales will dry up to people without cash..or access to finance.
So I expect secondhand prices to continue to fall for anything large or over 6 years old.
I apolgise to those who think I am a dreary pessimist spreading gloom and doom.
I just tell it as I see it.
Of course you can belive A Darling instead and it will all be over in Quarter 3 2009. If so I am totally wrong and we shall have had the shortest and shallowest recession for 60 years and Darling's "worse financial crisis for 60 years "was wrong as well as me.
Silly me. I must have believed what a politician said. Section me quickly. :-)
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We are in the first deflationary period the economy has known since 1929. Only the Japanese has experienced it since and it ain't pretty. People have trouble getting their heads around huge drops in the value of things that they consider have a 'value' - houses, cars, other big ticket items.
I think we will go through Christmas now and between mid-Jan and April we will see one big company after another go bust. People will be so afraid of losing their job and subsequently their home that there will be little spent on cars so car prices will fall much further.
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" cars so car prices will fall much further."
But to fall further they would have to be sold at a loss. Therefore the car companies are better off not making the cars thus not lose money on each one sold. No income is better than negative income. But what happens to the workers for the assembly lines? What happens to the component manufacturer's and what about steel workers etc.
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No income is better than negative income
It costs money to store & maintain cars in showrooms! Not sure about cars, but supermarkets do sometimes clear goods at a lower than purchase price just to make rooms for new products (where they will make up their losses).
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Movilogo, I was actually referring to making the cars. Honda for example is shutting down the Swindon plant for about 2 months. They would rather not make cars and try to sell what has already been made than to lose money on any new cars made.
Must be awful for the workers - they may get their minimum wages but they probably don't get the additional money from shifts or other "bonuses".
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Three British recessions compared ................ tinyurl.com/6459mp
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Must be awful for the workers - they may get their minimum wages but they probably don't get the additional money from shifts or other "bonuses".
I was talking to someone the other day whose company does production line fit-out work for Honda and others. He said the Honda workers are getting paid basic salary for their 2 months off, then when they get back they will have to do unpaid overtime.
A mate of mine used to work for one of the major car rental companies. The other week he heard they had not yet placed their normal orders for 2009 cars; they are going to run their existing fleet to higher mileages instead. I wonder if other big companies with massive fleets are doing the same?
Considering this company normally buys around 50000 cars per year I bet the car manufacturers are not too chuffed; and it will have an effect on the used car market.
Edited by Rich 9-3 on 03/12/2008 at 11:34
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Hmmmm, car dealer in "great time to buy a car" shocker.
or is it just my cynicism?
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Do we know where he is based? IF we don't buy from him he gains nothing but the industry has a sale.
Does that matter? Yes. If we all stop spending on anything apart from essentials we will have a very bad time.... but that comment should be in the Credit Crunch thread.
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>If we all stop spending on anything apart from essentials we will have a very bad time ..
Well, maybe - what you mean is we should get used to very different lifestyles. The present Crunch is as bad as it is because things have gone on getting 'better and better' for much longer than the traditional business cycle of 4-5 years, and we have got used to that. To keep on topic, many people have habitually changed their 'new' cars much more often than they 'need' to, but hey! - they had the money, so why not? The irony is that makers have been forced over the last 30 years to build cars that can last that long without rusting, but what for? - they are crushed after about 12. And to produce enough to satisfy the demand at the price expected, bigger factories have been built where labour is cheaper, and the earlier ones in Western Europe are now threatened. Silly, isn't it?
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Wife wants to change her car in the spring - current Corsa (11/07) for a new Fiesta.
Should we wait for the spring or is the above statement really true?
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Should we wait for the spring or is the above statement really true?
IMO - Depending on the import content in the make up of the car, and the currency of the country where the majority of the parts and labour are charged, it is likely that the £'s devaluation will start to impact new car prices upwards in 2009.
Edited by jbif on 04/12/2008 at 12:57
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At the moment I do not believe any manufacturer can mass produce cars at a price people are preparred to pay. Why pay £20k for a new car, when it be worth less than £10k a year later ?
I think there will need to be considerable deflation in wages (already happening in raw materials, energy etc.) before auto manufacturing becomes viable again
MVP
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