Target Price Market Report – April 2021
Target Price market update
In the year since car showrooms were first forced to close their doors, the average cash Target Price discount has steadily reduced and is now more than 21% lower, in relative terms, than this time 12 months ago.
This means that consumers can currently expect to haggle an average 7.1% or £2789 discount when buying a new car.
Coupés and family cars have suffered the biggest individual segment reductions in average cash Target Price discount over the last year, at 39.4% and 30% (in relative terms) respectively, while small cars and luxury cars remain broadly unchanged, having bounced back from a significant dip in typical transaction price savings in the first few months of the first lockdown period.
As we head into the post-lockdown quarter 2 period, it will be interesting to see if the downward pressure on cash Target Price discounts continues. Talk of a rush of consumer demand combined with supply problems exacerbated by global semiconductor shortages all point towards consumers paying more for their cars.
But long delivery lead times and reduced discounts tend to only work on the most desirable vehicle segments and models. It is more likely that consumers will look to overcome lead times by buying stock vehicles or nearly new models and avoid having to accept reduced discounts by shopping around for competitor’s offers. This presents opportunities for manufacturers that have mitigated their supply issues and wish to grow conquest market share.
Seat dealers are currently the most generous when offering an average cash Target Price discount across a model range at 15%, followed by Nissan at 13.5% and Renault at 13.1%.
Seat has recorded the highest month-on-month increase in the average cash Target Price saving, too, with the typically achievable showroom discount across the model range up by 5.1% to 21.9%.
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