The Price List Okey-Cokey!
Friday, 6. July 2018
Fleet News highlighted the problems faced by most of us in the industry this week as manufacturers try to resolve the problems they face attempting to get their cars through the WLTP (Worldwide harmonised Light vehicle Test Procedure). As cars are tested and fail the more stringent tests they are removed from the manufacturers’ price lists whilst they work on a ‘fix’.
They fix the problem, test it themselves, feel that the car is OK and back on the list they go ready for the next test. The car then fails again because the manufacturers haven’t been able to totally replicate the test conditions imposed on their cars at the test centres. So the car is removed from the price list again.
This means that some manufacturers have stopped taking orders and stopped production of some of their models altogether. Orders can’t be placed as the manufacturers can’t say when their cars will be approved and without knowing the cost of the modifications necessary to get them over the line they can’t set the list price.
Without the cost, they can’t calculate the new list price. Without the list price the leasing companies can’t release their rates – it’s a mess! As a result of all the confusion, one leasing company has decided to take all cars off their lease quoting system unless they have been WLTP approved. One of the reasons for this is the confusion caused over interim arrangements put in place to calculate benefit in kind tax for those driving company cars.
The rules tighten further from the 1st September which means that if cars have not been approved under the WLTP rules they cannot be sold. This will, in theory, lead to a lot of cars being pre-registered in August at big discounts unless, like the rest of Europe, our Government allows an extension. This has led to uncertainty amongst those waiting to take out a new lease expecting some mega-deals in August.
This situation could well lead to some brilliant lease deals – but it may not. It’s a gamble that I won’t advise on when asked if customers should wait. What with the uncertainties of Brexit life is tough at the moment in the car industry and confusing for customers. By Graham Hill
