DS had the biggest increase in the typically achievable cash Target Price discount
What Car?’s Target Price data, provided exclusively to Autocar Business, reveals return to buyer’s market
What Car?‘s latest data reveals that a third of its featured manufacturers have increased average cash Target Price discounts, another third have reduced discounts and the final third remain broadly unchanged.
This represents a turbulent market state where dealers are trying to maintain the seller’s advantage that grew out of the Covid-19 pandemic and semiconductor supply crisis.
This is despite market factors, such as demand, the cost-of-living crisis, vehicle supply and electric car sales targets moving slowly, but inexorably, towards restoring the buyers’ advantage.
Salespeople will continue to resist discounting, because they, and consumers, have become accustomed to this over the past couple of years. However, car buyers need to be encouraged to push for better deals, and be prepared to shop elsewhere if a salesperson won’t budge.
This report is an extract from What Car?‘s monthly Insight PDF. Click here for access to the latest issue, exclusive to Autocar Business.
The all-segment average cash Target Price discount is marginally up on last month, at 3.9% or £1778 per car. This figure reduces to £1481 per car after allowing for dealer contributions towards manufacturer finance offers.
An additional average of £897 per car is then available as a finance deposit contribution when consumers buy using a manufacturer’s PCP deal at an average 7.1% APR bringing the total (cash and finance) average Target Price saving to £2378 per car.
Although the average PCP APR has increased from 6.5% to 7.1%, manufacturers have tried to cushion the effect of this with a 14.4% increase in the average finance deposit contribution (up from £784 per car to £897).
DS has the biggest increase in the typically achievable cash Target Price discount, with a 1% increase across the range, up from 3.9% to 4.9%.
Target Price market watch
Following three successive monthly increases in the average cash Target Price, the typically achievable transaction price saving across small SUVs is unchanged from last month, at 4.1% or £1155 per car.
Although this is a competitive segment in terms of the choice of models, it is also a very desirable start point for consumers wishing to access SUV-style driving. This means that dealers can keep cash discounts at an average of 2.1% on over half of the models in the segment.
For consumers who are flexible with their brand choices, better deals are available. Nissan buyers can pick up an average 7.9% cash saving on Juke variants, a typical 7.2% reduction is achievable on Seat Arona models, while Renault dealers will typically sanction a 6.6% cash discount on Captur versions.
The cash Target Price discount is adjusted to £1010 per car after allowing for dealer contributions towards fi nance offers. These offers are linked to an average PCP APR that is currently 7.4%, and includes an additional £855 per car in finance deposit contributions. This means the total (cash and finance) average Target Price saving across the segment is £1865 per car.
What Car? expects savings to trend upwards over the next quarter, because small SUVs will not be immune to the competitive pressures that are expected to build throughout 2023. Salespeople will have to start battling for business again, as the industry increases car production.
Thanks to a fourth consecutive monthly increase, the average cash Target Price discount across small cars is currently 4.6% or £1030 per car.
Once dealer contributions towards manufacturer’s PCP offers are accounted for, the total (cash and finance) average Target Price saving is £1467 per car based on an average PCP APR of 7.1%.
While the average PCP APR has increased from 6.3% to 7.1%, the average finance deposit contribution has jumped from £479 per car last month, to £622 currently. Toyota, Peugeot, and Renault dealers are offering the best average transaction price discounts, with 7.3% (£1667 per car) on Yaris versions, 6.8% (£1506 per car) on 208 petrol and diesel models, and 6.6% (£1373 per car) on Clio variants.
What Car? is Autocar Business’s sibling publication, and its monthly Insight PDF is a critical source of exclusive information for car retailers and buyers alike.