22/04/2008

Limited inital stock to translate into £500 more in the used market

However, once the inevitable increase in supply occurs, values will only be slightly better than the previous Focus

The new-look Ford Focus, launched in February, is expected to be worth up to £500 more than the model it replaces when the first examples reach the second-hand market later this year.

List prices for new examples will remain the same as the outgoing Focus - introduced in 2004 - but improved styling and enhanced specification across the range should make the latest-generation model more desirable to used car buyers.

The Ford range is full of big sellers, and there is none bigger than the Focus, which has been the UK's best-selling car every year since 1999. High sales volumes inevitably put pressure on the residual values of Fords - with so many examples of each car to choose from, buyers are spoilt for choice, and supply generally satisfies demand.

When the latest Focus hits the forecourts, however, stocks will be limited for the first few months. Prices will hold up fairly well, reflecting the low level of supply and the anticipated jump in demand for what many perceive to be a more attractive car compared to its predecessor.

When the used car market senses that the new model is available in greater numbers, the Focus may revert to type. An increase in supply is expected to erode the price premium, eventually leaving values only marginally ahead of the previous Focus. Much will depend on Ford's approach to handling sales volumes. Putting significant quantities into short-term rental companies, for example, will bring a large number of units back to the second-hand market very quickly. If Ford takes a more controlled approach, values may remain relatively high for many months.
       
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