People carriers top used car index

People carriers - or MPVs as they are known - are best at retaining value, says the latest GE Capital Woodchester's car price index which tracks used car prices in Ireland.

According to the Irish survey, medium and large MPVs hold on average 70 per cent of their initial sale price after two years and 60 per cent after three. Even in its fourth year, an MPV can be expected to have held about 50 per cent. These residuals compare very favourably with equivalently priced family cars which showed residual values of 50 per cent after three years and 28 per cent after five years.

The survey broke the MPV market into three categories: mini MPVs such as the Toyota Yaris Verso and Fiat Idea; medium MPVs such as the Opel Zafira and Renault Scenic; and large MPVs such as the Hyundai Trajet, VW Sharan and Chrysler Voyager. However, the mini MPV market is too new for any strong data on residuals just yet. In fact, there are several industry disagreements over which models qualify as mini MPVs.

Overall, the results for May show that the Opel Zafira and Seat Alhambra to be among the most the most consistent for resale value over three year. They also shows that in the medium category, diesels retained four per cent less of original value than petrol equivalents over the same period. In particular, in the small and medium MPV ranges petrol is more popular particularly up to 1.6 litre engines.

There has been enormous growth in the MPV market in the past five years. According to Eoin Lynam, marketing director of GE Capital Woodchester, up to now demand for most used models has outstripped supply contributing to high residual values. In particular he points to owners holding onto these models slightly longer than saloon cars. Therefore they have not as yet come back to the used market in big numbers.

There is also the knock-on effect of recent legislation on seat belts for all passengers and the over-riding fact that, as the MPV market is relatively new here, only a very small number of used models are available as yet.

In the large MPV category where diesel is the top seller, there is a reversal of the fuel difference in used prices, although there are some notable exceptions and in terms of residual values the gap is not dramatic.

"While demand is greater for diesel the lack of numbers dictates that all values will remain firm," says Lynam.

In this category the reduction for petrol is in the order of 3 per cent against new prices.

Again the figures are very strong with three-year values being higher than any of the standard classes recorded in the first quarter this year.

"Traditional family car buyers are now able to afford to borrow more and move up a model," says Lynam, "especially given the lower interest rate environment currently prevailing."

The index was prepared in association with Motor Trade Publishers Limited, and was complied from used car prices in the Irish market during May.