Diesel premiums held

Research by Glass's found that there was “little or no pressure” on car makers as the diesel market was going from strength to strength. The study found that the pricing policy of manufacturers for diesel cars has been consistent in the last few years. Premiums of £1,100 for diesel cars in the lower-medium sector have remained unchanged from 2004, representing a gap of 9 per cent over petrol equivalent models. Continued strong levels of demand for oil burners was also evident in the used market. Glass's said this was likely to underpin a residual value premium over petrol-powered equivalents for at least another 12 months. The 9 per cent premium found for new diesel cars compared to equivalent petrol models increased to 14 per cent after three years or 36,000 miles, Glass's said. l As many as 100,000 new diesel registrations could be squeezed into 2005 because a tax loophole is set to close at the end of the year. The Euro 4 diesel legislation, which offers a 3 per cent waiver on company car tax, will be scrapped at midnight on 31 December. Lex Vehicle Leasing claims the impact on the motor trade could be significantly bigger than anticipated. “If 100,000 orders are brought forward into the last quarter of 2005 the car industry could be heading for another strong year and indicates that sales will be down next year,” Steve Jones, Lex Vehicle Leasing's pricing manager said.