Credit crunch may impact on car sales, warns importer
Author: Robin Roberts
Published: 24 September 2007
Speaking at the launch of the new generation Subaru Impreza, the boss of the east Birmingham-based importer said some car buyers were going to find it much harder to finance car purchase as lenders made more cautious decisions.
He believes there could be a strong divide between better off older buyers who largely finance their own purchases and younger buyers who rely on finance companies to borrow funds.
Mr Edmiston, the son of IM Group founder Sir Bob Edmiston, said, “As a distributor with our own finance company we do not have problems but anyone who is using their own lending facility may find it much more difficult to finance a car.
“I don’t think the effects of the current financial situation will be felt immediately and car sales this year will largely be as predicted by the SMMT, but possibly in a few months and into early next year we could see the effects.”
Financial decisions on car purchases for the 57-plate were made before the current lending crisis gripped the economy, but the 08-plate arrival could see the change predicted by Mr Edmiston.
The longer term affect of the financial situation may alter the market in a less expected way because better off older buyers choose different cars to younger people so the executive or luxury end of the market is less likely to be affected than the entry level sector.
Even within sectors there could be changes as certain trim levels and models become less or more attractive depending on buyers’ circumstances.
Subaru executive director sales and marketing Lawrence Good said the new five-door only Impreza is priced to compete with the sector leaders and is £2,000 cheaper than the series it replaces. The seven-model 1.5 and 2.0 manual and automatic Subaru Impreza range runs from £12,495 to £19,995.
Subaru anticipate selling 300 versions this year, 650 in 2008 and the arrival of a 2.0 high performance diesel will help with fleet sales next year.
The IM Group has 80 dealers at the moment and is on target for 100 by 2010, when it expects to sell 15,000 new cars compared to 7,300 this year as the entire range is renewed and refreshed, including reintroducing a two-wheel-drive Justy as an entry level model.
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