The future is different
Shifts in ownership, generational trends, alternative fuels and a host of influences will affect future vehicle values according Dylan Setterfield, international forecast manager, cap hpi.
Dylan opened his session by referring to two famous quotes on predicting the future: ‘never make predications especially about the future’ (Casey Stengel) – Dylan quipped ‘unfortunately, that’s my job’ – and (Peter Drucker) ‘the only thing we know about the future is that it will be different’ – ‘that doesn’t help me very much,’ said Dylan.
Dylan then referred to how when predicting the future, we have to look at the past and spoke of the technology portrayed in 2002’s Minority Report film – ‘much of which now exists’ said Dylan.
Dylan provided an overview of the UK used vehicle market, specifically focusing on the past two years showing a gradual decline overall in residual values, with city cars experiencing greater loss while luxury executive vehicles fluctuated – ‘much of this is driven by vehicle manufacturer activity’.
Focusing on changing ownership models such as the growth in PCP, Dylan also suggested there was wider change taking place – something he referred to as ‘iphoneification’. Dylan explained, ‘This is the change in attitude of consumers to ‘how much will it cost me per month and can I upgrade it.’ Dylan also pointed to change in ownership and the increasing focus on mobility services – ‘it is not expected to replace car ownership but rather complement it. It’s for the OEMs to now focus on utilisation rather than the number of units sold – ‘for that to work there needs to be a wholesale change in manufacturer mindset. Whether VMs can do that is the question.
He continued, ‘The change in consumer behaviour offers a massive opportunity for OEMs.’
Dylan then moved on to discuss consumer expectations – ‘they expect the same level of connectivity as they get in their home’ he suggested. ‘There are concerns about security and privacy with much greater concerns in mature markets. Developing markets have very different attitudes towards connected vehicles,’ he said.
Referring to the vehicle technology trickle down, and the influence this could have on residual values, Dylan suggested with some features it might become a case of ‘if you haven’t got it, you’ve got a lemon.’
Discussing the generational shift Dylan said, ‘Consumers have a willingness to buy from technology companies eg Apple and Google, but have more trust in OEMs, especially regarding safety – this is why we will probably get to autonomous vehicles via partnerships.’
Dylan closed his session by stating: ‘With changes in attitudes, mobility services set to grow, PCP to remain dominant, rising numbers of connected vehicles, autonomous vehicles a reality and alternative fuels for managing environmental impact, the only thing we know about the future is that it is going to be different.’
IBIS Ireland 2016 was headline partnered by AkzoNobel and Audatex, along with partners Fastcare and Enterprise.