Unfashionable, but very, very practical
13 September 2006
They're not considered cool, yet prices for sensible Mondeo-sized cars are climbing in the auction houses
There's no doubt the recent shift away from the traditional business car scheme to an allowance based one with drivers having a wider choice of cars has changed the face of the large family car sector. With the cash now in their pockets, buyers are moving away from the traditional five-door repmobiles that once dominated the company car list, instead opting for smaller hatchbacks, 4x4s, coupes and niche models.
That said, used prices have stabilised, rising by 5% in Q2 2006, and are now 9% higher than the corresponding period last year.
"They may not be the height of fashion, yet motorists still recognise there's nothing better than a five-door hatchback for transporting five passengers and their luggage in comfort," says Andrew Shepherd, Manheim's chief group auctioneer.
While prices may be up, a fall in mileage in Q2 2006 helps justify the increase. With just less than 63,000 miles on the clock - a drop of 5% or nearly 4000 miles on the previous quarter - the average second-hand family saloon still has plenty of miles left in it.
An interesting trend is the difference in age versus mileage covered between petrols and diesels. Diesels are changed an average of 15 months earlier than petrol models yet with only 1374 fewer miles. "This suggests the fleet sector continues to de-fleet diesel and petrol models at common mileage thresholds, yet clearly diesels are reaching these much earlier," explains Shepherd.
Nevertheless, diesel still commands a price premium over petrol, with aircon and satnav also ensuring a quick sale and a good price.
Buyers will also look closely at service intervals, and it can be a real turn off if a car is being offered when a major service is due very soon. Graham Smith of BCA suggests "it could well be worth getting the work done in advance and getting this declared when the car is sold". Smith adds: "If you change your cars at three years, get the first MOT done as well."
Whatever you do, get minor repairs to paint and trim done. Smart repairs can be done at the point of sale and can represent excellent value for money. "Typically expect to get back around three times your investment in terms of additional bidding," says Smith.
As they're not desperately fashionable, the trick for the fleet operator at selling time is to differentiate their product in a crowded marketplace and this means a high specification and a good colour - metallic blues and silvers go well, for example. Fussy colour schemes do nothing for product in this sector, while flat drab and dark colours can make large cars look almost funereal.
The upper medium sector is typified by well-engineered, often high-specification cars that probably represent the best value for money of any sector. Mondeo and Vectra are the benchmark cars, while Citroen's C5 offers plenty of space from its well-designed interior. The Nissan Primera is a strong contender and Peugeot's 407 remains a steady performer in the used market.