The new president Obama has set new fuel consumption targets for all new cars sold in the USA. The initial target is somewhere around 35.5 miles per gallon which for motorists here in the UK seems an easy task especially as they have to 2016 to do it. With large cars including SUV’s pretty much unpopular now, it should fall into most car manufacturer’s business plan anyway. Most drivers not see fuel economy as a major factor in buying their day to day transport.
What isn’t clear is weekend vehicles such as supercars used for leisure purposes. Does this mean the end of large engine cars used only now and again for pleasure? This target is inline with a target to reduce carbon emissions by 2030 by 50%, something the USA has been criticised for in the past as not being forward enough. The economic situation has given the leverage to pass these targets without too much criticism.
In the meantime another $4bn has been loaned to GM Motors with a statement that all USA car manufacturers should come out of this recession leaner and more efficient delivering more fuel efficient cars. There is no doubt the benefit a new face can have to the car industry and whilst Obama’s honeymoon with the world continues, be able to make difficult decisions with only the minimum of backlash.
The internet has brought us many things including the ability to get prices of good quicker and cheaper and that have also included the car parts market. Of course the used car parts market was something different in that breaker yards often have a different inventory each day as cars came and were dismantled within their business. It became hard to add stock on an online database, so a new system had to be created to allow used car part suppliers to quote on what was available and the condition that particular item was in.
One such system is called CarSpareFinder which allows a consumer to add their required part details into a system which when a used car parts suppliers see the details can fill in a simple quote form and that price will be sent direct to the consumers email box.
This is a great online system to allow a consumer to compare used car prices and benefit from those prices offered. Often one breaker has a totally different price structure than another and real bargains can be found, the only other deciding factor being delivery costs. To get an idea of how this car part locator system works we have their video direct from CarSpareFinder.
Of course the UK has not been very successful in owning a new car plant when you consider all the UK brands of cars that have originated from the UK and then moved to the UK car manufacturer in the sky. But what is surprising is the amount of cars that are manufactured in the UK by foreign owners. There are Honda, Nissan, Ford, Vauxhall, Land Rover, Jaguar and Aston Martin which is now back in UK hands.
So when the recent down turn in buying a new car arrived many workers found themselves on a shorter working week or unpaid holiday or even made redundant. In total contrast the used car market has stood up well to the recent recession. It seems people still need to upgrade their cars or wish to have a newer one but have decided that the depreciation of a new car is no longer and acceptable cost to the ownership of their vehicle.
It has effected the used car market in a way not expected, in that some used cars have actually increased in value during difficult economic times as demand is sometimes outstripping supply especially as very few trade ins are coming from the new car market. The government has recently stepped in with a scrappage scheme offering to reward a buyer with £2000 should they buy a new car and trade in a car over 10 years old. Even though this has proved to be a winner in Germany and a few other countries there is more negativity across here, with statements that those who currently own a 10 year old car are not in the market for a new one. Condition that state you must own the old car for at least 12 months before you trade it in, stops anyone buying an old car for the purpose of the cash back.
With new car manufacturing down, so it the car parts market also. There have been many small car parts manufacturers forced out of business because all their eggs were in one basket supplying to one factory. As is normal in these economic climes, if one large manufacturer reduces capacity many other smaller businesses go to the wall.
The latest news is that an improvement in sales is expected in future months although not a previous levels, but some car manufacturers like Nissan have decided to re-employ some workers for the expected upturn. However around the world there are many other stories going on with ownership changes likely. Fiat who themselves have been bailed out many times by the Government are currently in talks to buy Chrysler and Opel Vauxhall arm of GM Motors is one story of many.
As the bank Of England stated yesterday, no-one really knows when this downturn will change around, but lets hope it is sooner rather than later.