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The residual value expert's view
The popularity of second-hand diesels is due to pretty simple factors, according to Andrew Jackson, head of analytics at Glass's. He reckons that, among other reasons, used buyers just prefer them: "Buyers still remain keen on the diesel variants irrespective of the price differential," he says. "It seems to be the case that the concept of mileage versus fuel efficiency is being increasingly won by diesel, as the concept of low mileage plus lower cost of ownership is not as emotive as higher mpg, which an equivalent diesel perennially offers."
He advises businesses to keep their wits about them, though, and avoid bulk disposal of diesel-engined vehicles at the same time as competitors, which will shatter residual values: "[Fleets] need to look at the market activity of competitors and make sure they are not 'following the crowd'. As we all know, too many of the same variant at the same time will reduce residuals."
The bigger picture, according to Jackson, is to consider the adoption of alternative fuels if it works for your business.
"Petrol and diesel fortunes are anticipated to remain the same for the next 12-24 months. Fleets would be wise to monitor hybrid and electric vehicle technology, as some of these models are becoming viable alternatives on a technical basis; however, RVs are still plagued by concerns surrounding battery failure anxiety as well as broader long-term appeal and viability.
"Considering the premium that has to be paid for such vehicles, it is understandable if companies are cautious about acquiring a large hybrid fleet. That said, Government policy and incentives are pushing this type of vehicle and some feel it will become an important market - the question is when rather than if."
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