Second-hand car values are set to plummet, according to motor industry analysts, with used-car prices expected to fall by an additional 8 per cent this year on top of typical depreciation.
Market analysts from EurotaxGlass's believe that, in addition to environmental taxes, the slowdown in the economy is putting the brakes on prices.
EurotaxGlass's has warned that the increasing cost of borrowing, static property prices and tighter lending criteria are beginning to affect household budgets, with big family cars and four-wheel-drive vehicles the hardest hit. Smaller and fuel-efficient cars would hold their value better in the future, the company said.
The prediction followed Chancellor Alistair Darling's announcement of a new vehicle excise duty based on carbon dioxide emission levels. From 2010, the worst- offending new gas- guzzlers will be hit by a £950-a-year tax, while the most fuel-efficient new cars will be exempt for a year. The Chancellor plans to lobby the EU to cap car emissions at 100g of carbon dioxide per kilometre.
However, in a widely anticipated move, the planned 2p increase in fuel tax was delayed by six months until October, though from 2010 fuel duty will rise by 0.5p above inflation on environmental grounds.Reuse content