'PCP' - Plebs Chariots Postponed
https://www.telegraph.co.uk/money/c...ns-debt-fuelled-new-car-addiction-coming-end/
- the article is rubbish. The main, overriding, glaring reason PCP has gone bang is the collapse of secondhand values - not the La la land garbage peddled to the credulous masses on Autotrader and Pistonheads, but real trade values, in closed, franchise dealer-only auctions, at the likes of BCA, Measham.
PCP only makes sense for the car makers, and their finance arms, banks basically, if they can move on that 3 yr old, ~30k miles car, for no less than 50% of rrp. The collapse, unannounced to the plebs, since at least mid summer, in UK, has made many of these cars basically unsellable. If they drop the price, say 40% of rrp, they cut their throats, as this sets a new level, and the vicious circle will step it down further, as the buyers sense blood in the water, and panic in the whole system - no one wanting to be left with inventory.
It was a bubble, held up as much by confidence as the money printing, and hence house price values, that supported it all.
You can't deflate a bubble gradually, or partly. Pistonheads and AT might want you to believe we are still at peak, or even asking prices of private sellers going up again, but it's just another confidence trick - don't believe your grey matter and eyes.
The Telegraph article is actually more about telling these clowns - the affluent Pistonheads advertisers, with their stables of investment cars - that the game's up, and they'd better get with it - drop those prices sharpish, and massively.
https://www.telegraph.co.uk/money/c...ns-debt-fuelled-new-car-addiction-coming-end/
- the article is rubbish. The main, overriding, glaring reason PCP has gone bang is the collapse of secondhand values - not the La la land garbage peddled to the credulous masses on Autotrader and Pistonheads, but real trade values, in closed, franchise dealer-only auctions, at the likes of BCA, Measham.
PCP only makes sense for the car makers, and their finance arms, banks basically, if they can move on that 3 yr old, ~30k miles car, for no less than 50% of rrp. The collapse, unannounced to the plebs, since at least mid summer, in UK, has made many of these cars basically unsellable. If they drop the price, say 40% of rrp, they cut their throats, as this sets a new level, and the vicious circle will step it down further, as the buyers sense blood in the water, and panic in the whole system - no one wanting to be left with inventory.
It was a bubble, held up as much by confidence as the money printing, and hence house price values, that supported it all.
You can't deflate a bubble gradually, or partly. Pistonheads and AT might want you to believe we are still at peak, or even asking prices of private sellers going up again, but it's just another confidence trick - don't believe your grey matter and eyes.
The Telegraph article is actually more about telling these clowns - the affluent Pistonheads advertisers, with their stables of investment cars - that the game's up, and they'd better get with it - drop those prices sharpish, and massively.
