“Stratospheric” rise in small car list prices challenges motorists and dealers alike, says CAP


RELENTLESSLY RISING new small car list prices are taking a toll on the pockets of motorists and dealers alike, according to CAP – the car pricing experts.

Since April 2009 average list prices in the most popular sector for private car buyers - the ‘Supermini’ type – rose 41% from £11,874 to £16,582 in April this year.

Although this figure has been inflated by the introduction of some more luxurious and expensive Supermini offerings from the likes of Audi, the underlying theme is still one of big price rises.

This means the average headline cost to change from a used to an equivalent new car increased from £7,008 in April 2009 to £10,315 in April 2012.

CAP's Retail & Consumer Price Editor, Philip Nothard, said: “It is fortunate that the prices for used Superminis have generally held up well over that period because when you factor falling used car prices into the equation it becomes ever harder for consumers to trade out of their small car and into a new one.”

Data sources: CAP New Vehicle Data & CAP Black Book

According to Nothard, dealers are just as frustrated by the upward drift of new car prices as car buyers and this is backed up by research.

He said: “When we recently asked dealers whether list price increases were negatively impacting on their business 68% of respondents said that they were.

“Of course, the list price on most cars is a base from which to negotiate a deal but high headline prices create a perception that the dealer then has to overcome.

“This is generally achieved by the use of ‘money off’ or cheap finance incentives but those also bring their own problems by making some new car deals so cheap it depresses the value of used cars, so in the end no one wins.

“The challenge to dealers and manufacturers alike is to first acknowledge the potential threat of continuous retail price increases and their inevitable impact on the consumer’s perceived cost to change.

“We can also be sure that ‘whole life cost’ information for consumers will be increasingly available in the very near future. If this is based on list prices, without taking transaction price into account – as it is today in the fleet sector – then unrealistic new prices will make many cars seem considerably less affordable on paper than they really are.”


For further information contact Mike Hind, Communications Manager - CAP
Tel: 0113 222 2044 / 07710 152030
Twitter @MikeH_CAP

CAP used car pricing and technical information has been trusted by motor trade professionals for more than 30 years. The company provides trusted and accurate pricing and technical information on cars, vans, motorcycles and trucks to the UK automotive industry every day. As well as helping dealers, fleet operators, insurers, vehicle manufacturers and finance providers, CAP information also operates at the heart of many leading vehicle marketing websites and car sales portals, including Britain’s largest – AutoTrader – helping consumers safely make the best informed decisions about their purchase choices.

CAP - Capitol House, Bond Court, Leeds LS1 5EZ
Telephone: 0113 222 2000 Facsimile: 0113 222 2001 www.cap.co.uk