The UK-based auto market information company, Glass’s, is forecasting that number-plate (‘registration plate’) changes planned for September in the UK will bring a surge in new vehicle sales. Six months away from the introduction of the change in September 2001, Glass’s is predicting a surge in new car sales, and a slight softening in residual values. Glass’s believes that new car sales in September will be boosted by the novel ‘historic’ affect of a new plate change. Used car prices or ‘residuals’ stand to be affected by the change.
‘Residual values of today’s new cars are greatly affected by the initial registration letter and where it is understood we believe the new system will carry some novelty value. As a result September sales this year are likely to be boosted slightly,’ said Glass’s Bill Carter.
Looking at its affect on residual values, the current two plate changes show that a new letter carries a 3% increase in value over the previous letter, but Glass’s believes there are two views on how the new system will affect residuals:
- Once motorists recognise the forthcoming number plate system they will be prepared to pay an equivalent premium in March and September as they were on the old alphabetic system.
- Under the new system the importance of the registration plate will fade back with the year in which the car was first registered becoming more important in determining a car’s value.
‘The plate that identifies a car as being new will be less obvious in the future and will lessen in importance. Those initial September plate cars will therefore be worth slightly less than the 3% premium normally experienced by a new plate,’ said Carter.
Background: In September 2001, the UK’s number plate system will be altered removing the alpha-based date prefix in favour of a geographically based (place of registration) system. Currently, the alpha-based prefix changes at 6 monthly intervals – itself a transition from the old system when the alpha-prefix served as a year identifier. For many years parts of the UK auto industry lobbied against the year identifier which changed in August and brought a huge seasonal surge in sales (August sales alone accounting for as much as a quarter of the annual new car market.) |
To view related research reports, please follow the links below:- Review of the UK Automotive Industry 2000 |
