Increased self-registrations could lead to record September figures, says CAP
Research into the number of cars registered during the first half of September suggests a double-digit increase on the same period last year. If the trend continues, the new car market could even exceed the widely forecast total for this year of 2,450,000.
CAP Automotive says that carmakers are taking a two-pronged approach to encouraging new car registrations by incentivising consumers and dealers alike. For motorists the main carrot in the current market is finance deals carefully structured to provide an attractive monthly cost as well as the traditional discount on screen price.
But millions of pounds are also being poured into “dealer contributions” – often known in the trade as “bonnet money” – to encourage the registration of new cars. With manufacturer contributions on some models as high as 25% of the car’s value, car retailers are being given major opportunities to generously negotiate new car deals with their customers.
Examples seen by CAP include:
- A manufacturer contribution to the dealer of nearly £17,000 on a £68,000 sports coupe.
- Contribution of £4,300 towards each registration of a £30,000 saloon model.
- A £6,000 contribution toward registering a large £37,000 saloon.
- Contributions ranging from £250 to £2,250 across a popular mainstream manufacturer’s range.
- Discount support of £500 and additional contribution of more than £800 on a popular small car, list priced just over £8,000.
With such substantial bonuses leading to increased “self-registrations” by dealers, CAP says that dealers are not always happy about the pressure on them to meet growing new car targets.
Philip Nothard, CAP’s Retail and Consumer expert, said: ‘This has the potential to be the biggest September on record for the new car market and the signs are that the year-end figures may take 2014 into the record books.
‘We believe registrations for 2014 may exceed official forecasts but, behind the positive headlines, many dealers are unhappy.
‘There is also a problem for some manufacturers in keeping up with demand and lead times have grown to 16 weeks for some models.
‘And because more new cars registered today means more used cars appearing tomorrow, there are concerns in some quarters that depreciation will inevitably increase in future years.’