British Drivers Could Save Over £56 Million Looking After their Cars
Sunday, 01 March 2009
Britain's drivers could be wiping millions of pounds off the re-sale value of their cars by not keeping them in good condition, research by online car insurer, swiftcover.com reveals.
A car in poor mechanical condition, with scratched bodywork and a grubby interior could sell for up to £2,000 less than the same model, of the same age and mileage, but in A1 condition.
For example, swiftcover.com found that a two year old BMW 5 series in excellent condition could sell for as much as £17,700 when sold privately - whereas the same car in poor condition would struggle to sell for £16,000.
Worse still, if the car has a higher than normal mileage, the re-sell value could drop even further. An extra 10,000 miles on the BMW 5 series could slash a further £1,000 off the price tag. So if the car is also in poor condition, a driver who bought the vehicle new in 2007 for £28,600 could see the value almost halve in just two years.
As SMMT (Society of Motor Manufactures and Traders) figures show new car registrations are down 31 per cent meaning that drivers are holding onto their existing vehicles for longer, swiftcover.com is urging people to do more to keep their cars in better condition to ensure a better re-sell value when they do come to sell, and keep running and repair costs low.
Craig Staniland, underwriting director at online car insurance provider swiftcover.com commented: "Despite drivers needing to watch every cost of motoring and look after their cars now more than ever, we have discovered that car owners could be losing an average of £2,075 on the re-sale value of their cars through poor car maintenance and excessive mileage. If each of the UK's 28 million registered cars is losing this much, it means an additional £56 million could be lost by Britain's motorists on what is usually one of their biggest expenses, which has soared to £5,627.48 per car per year according to the RAC's cost of driving index*."
Valuations for the following 2007 models from Parker's Car Price Guide reveal poor condition and high mileage can drastically affect the cars' value. For each additional 1,000 miles over the average mileage of 10,000 miles per year (20,000 miles for these two year old examples) up to £135 can be lost in value, depending on the model and original value.
| Car |
Original Value |
Good Condition Re-sale Value |
Poor Condition Re-sale Value |
Potential Loss Value |
| 2007 Ford Fiesta 1.25 Studio 3d |
| Average mileage (20k) |
£8,395 |
£4,460 |
£3,740 |
£720 |
| High mileage (30k) |
|
£4,160 |
£3,440 |
£300
(£30 per 1k miles) |
| Maximum Loss |
£1,020 |
| 2007 Volkswagen Passat 1.6 FSI 4d |
| Average mileage (20k) |
£15,522 |
£7,400 |
£6,165 |
£1,235 |
| High mileage (30k) |
|
£6,800 |
£5,565 |
£600
(£60 per 1k miles) |
| Maximum Loss |
£1,835 |
| 2007 BMW 523i SE 4d |
| Average mileage (20k) |
£28,655 |
£17,745 |
£16,055 |
£1,690 |
| High mileage (30k) |
|
£16,695 |
£15,005 |
£1,050
(£105 per 1k miles) |
| Maximum Loss |
£2,740 |
| 2007 Mini Cooper S 1.6 3d |
| Average mileage (20k) |
£16,000 |
£12,635 |
£10,530 |
£2,105 |
| High mileage (30k) |
|
£12,035 |
£9,930 |
£600
(£60 per 1k miles) |
| Maximum Loss |
£2,705 |
| Average Maximum Loss |
£2,075 |
As well as watching your mileage and trying to keep your car in good nick, Swiftcover recommends the following to retain as much value as possible in your car:
- Clean your car - Dirt and grime can develop into irreparable stains and damage so make sure you regularly clean and check your car.
- Get your car serviced regularly - Servicing is one of the best things to your car in shape. Keep your log book stamped and up to date and ensure you follow the manufacturer's servicing schedule to help retain as much value when you sell.
- Investigate warranties - Extended warranties offer extra protection, meaning you can fix many problems without shelling out. Shop around for cover, ask dealer and check cover level and limitations to decide if it's really worth it before paying out.
- Change parts - Follow the manufacturer's guides as much as possible regarding parts to keep your car at its best and minimise the risk of expensive repair jobs.
- Find a good garage - Many people leave minor problems to get worse for fear of being ripped off by garages. You can find accredited garages via organisations like the Motor Vehicles Repairers Association (www.mvra.com), Retail Motor Industry Federation (www.rmif.co.uk) or Unipart Car Care Network (www.uccc.co.uk).
ENDS
Notes to Editors
*The RAC's cost of driving index tracks the associated costs of owning a car including finance, depreciation, fuel, insurance, maintenance, tax and breakdown cover.
For press enquiries please contact:
Joshua Van Raalte or Paul Beadle
Brazil (PR agency for swiftcover.com)
01865 556 000
swiftcover@agencybrazil.com
About swiftcover.com:
Based in Send, near Guildford and employing over 250 people, www.swiftcover.com was born out of a desire to revolutionise the general insurance market. swiftcover.com started trading in June 2005, jointly owned by the founding management team and international insurer Primary Group.
swiftcover.com offers car, travel and pet insurance online, and is Britain's only insurance company without call centres, which means that the cost savings can be passed directly onto the customer and premiums are kept low. In 2008 swiftcover.com featured as the cheapest insurance quote on the comparison website moneysupermarket.com more often than any other insurer.
This powerful operating model combined with successful marketing and competitive pricing has proven to be a tremendous success. This year swiftcover.com has over half a million live policies and is considered to be the fastest growing insurer in the UK.
In 2007, AXA UK acquired swiftcover.com. It is now a wholly owned subsidiary of AXA Insurance UK PLC which forms part of AXA Group.
About AXA:
AXA UK is a part of the AXA Group. AXA is a world leader in financial protection. AXA's operations are diverse with major operations in Western Europe, North America and the Asia/Pacific area. AXA employs 120,000 staff and tied agents and, as of June 30 2006, had €1,091 billion in assets under management. AXA reported total IFRS revenues of €72 billion and IFRS underlying earnings of €3,258 million for the full year 2005. Our previous company performance is not a guide to how we may perform in the future.
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