Gold book forecast changes for the Upper Medium and Executive sectors
Customers, who take our gold book residual forecasting product, will see new forecasts in July for the Upper Medium and Executive sectors, which are based on revised future market deflation assumptions for these sectors.
The changes to our assumptions are in the main relatively minor.
These sector reviews are the second of a 5 month cycle in which we will revise our sector and fuel type future market deflation assumptions, based on our latest forecasts for new car registration volumes, the latest UK economic forecasts and our expectations for the future market dynamics of different fuel types. Collectively these will determine the balance of used car supply and demand, which drives future market deflation/inflation.
In the Upper Medium and Executive sectors we consider that over the next five years, overall registration volumes will continue to decline particularly in the early years, with a continuing shift away from diesel, primarily into petrol. The shift away from diesel will be less marked for the larger vehicles. Over the same period, future used demand will change but continue to broadly balance the change in supply for both fuel types; with the scales tipping slightly in favour of less deflation for petrol cars.
The resulting changes in our deflation assumptions at 36/60k are as follows:
Upper Medium Diesel: no change
Upper Medium Petrol: +1.6% improvement (less deflation)