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April 12, 2010

Will Removal Of Scrappage Kick Start Car Lease

Filed under: Lease — admin @ 11:44 am

Unfortunately the car scrappage scheme was not aimed at the car lease purchaser, so you could not trade in you 10 year old banger for something you would lease rather than buy.  Not that many would of course, with the exception of trading in the second car to gain your £2k. But there may have been positive kickbacks, as used car values increased die to most owners of 10 year old cars believing they were worth at lease £2k and the shortage of new purchasers did mean used cars went up in value.

High residual values meant that monthly premiums went down, as car lease is pretty much based on how much a car depreciates in value. But now as we head into the new tax year of 2010, the scrappage scheme has come to an end,  and it is not up to the manufacturers to deliver the discounts to get people to buy their cars. We are not yet sure whether this to be a positive or negative to the car lease market. Will used prices now plummet as your car is worth what someone will pay, rather than a government grant, or will they soar even further as the new car market slows down. The availability of finance appears to be better although, interest rates of 8% plus are not uncommon. Manufacturers are almost racing to create engines that run on gasses and then some, so CO2 emissions are coming  down and so are the road tax and benefit in kind you will have to pay as a company vehicle owner, so 2010 is an all change, lets hope things work out sort of year, where it will take more than some optimism to kick start not only the car lease market but the new car market also.

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