Short terms and 0% deals aim to ‘pull back’ car finance losses in Q2

When looking at the performance drop in Q1 2018, it has to be through the prism of many brands posting record figures over the same period last year.

This year’s March plate-change was still the fourth-biggest on record and every dealer was prepared for a fall in demand.

Daksh Gupta, the chief executive of Marshall Motor Group, said: “We all smashed our targets over the first three months of last year, so the Q1 drop in 2018 is really no surprise.

“That being said, the market is more challenging as there isn’t the strength of bonus or margin. I was speaking to one of my peers recently and we agreed that Q1 was all about damage limitation and the rest of the year is about pulling it back.”

Finance offers are going to play a major part in the comeback and there are certain manufacturers that really need a boost in Q2.

Nissan has seen some of the heaviest drops in registrations, with a 33.5% fall during the March plate-change, matched by a similar 35% drop over Q1 as a whole. This is despite the Qashqai being a top three best-seller in March.

However, dealers would be hard-pressed to complain about Nissan’s offers to tempt customers into showrooms during Q2.

It is offering 0% finance on most of its range, from core models to the X-Trail and 370Z, and is also throwing in two years’ free servicing.

The Leaf and GT-R are the only two models with APRs above that level, at 4.45% and 5.49% respectively.

The next-generation Leaf is fresh to the market, so Nissan will be hoping demand for it will negate its higher interest rate. It gives a good indication of Nissan’s confidence in the new product.

Nissan is not reacting to its drop in registrations with stress discounting – there are no deposit contributions to help push volume in its published offers over the next three months.

Ford is always a good indicator of how the market is performing – even with a drop of 21.6% in registrations, it still dwarfs any other manufacturer at 81,957 units over the quarter.

Its Q2 strategy revolves around a strong 0% offer across most models, but with a finance term of just 24 months.

While Vauxhall is no longer able to keep pace with Ford’s volumes – it was in third place in Q1 on 54,535 units – it is mirroring the market-leader’s strategy. Vauxhall’s representative examples are almost all 24-month offers at 0%.

Vauxhall is only running its 24-month offers until the end of April, whereas Ford is continuing throughout the next three months. It will be interesting to see if Vauxhall changes tack for the remainder of Q2.

Q2 manufacturer new car finance rates examples