ExpertEye European Automotive Report Q2 2016 | Page 12
European Passenger Car Residual Value Trends
.
Residual values in the UK continue to ease back as the
new car market gets closer to overheating. With Brexit a
little over 2 years away RV setters need to consider what
the economic situation will look like and with it the
consumer demand for vehicles they are putting onto their
fleet today. Added to this are the changes in accounting
standards, IFRS 16 Leases, which sees leased assets
moving back onto the lessor’s balance sheet.
Southern Europe still has some way to go before it is clear
of its economic troubles and with new ones potentially
just around the corner, e.g. the banking crisis in Italy and
Portugal plus potential trade barriers with key export
% RV Index - 36 Months / 90,000 Km
130
120
110
100
90
80
2010
2011
EU Average
Italy
UK
2012
2013
2014
France
Spain
Index 100 = Values in 2010
2015
Germany
Portugal
2016 ytd
Source: Experteye AG
markets like the UK there is a lot to be concerned about. Despite this the overall opinion of RV setters’ remains positive with values
continuing to see strong gains, especially in Spain and Italy. Even the generally more cautious German and French RV setters have been
pushing up RVs for the last couple of years as a general wave of positivity surrounds the automotive industry.
The most notable exception to this positive trend is Portugal, however this is in part due to the semi-closed position of the country due to
the used vehicle import taxation which meant RVs have fallen less and thus have less ground to recover. RVs are generally on the increase
though but underlying factors will be playing a significant part in the decisions taken over RVs.
The Brexit result has caused shock waves across Europe and beyond and whilst the immediate cataclysmic aftermath predicted by some
doomsayers has failed to materialise there is a strongly cautious view being taken to its impact. With sterling falling new vehicle discounting
is likely to switch back to the euro zone and this will undoubtedly see RVs plateau and even start to fall there in the medium term.
European Automotive Report - 2016 Quarter 2
11