12:14 pm, August 20, 2024
Large finance companies are beginning to refuse deals on electric cars in a worrying trend for EV customers and dealers alike.
That is according to leading car dealer Jonathan Seaman, who says that some finance houses ‘still don’t have the brains around residuals’.
The Anycolourcar boss has been appearing on the latest episode of the Car Dealer Podcast, sponsored by JATO, where he had more than a few strong words for the motor finance industry.
In a conversation with hosts James Baggott and Jon Reay, the subject turned to EVs and with their incentives being scrapped next year, Seaman warned that finance companies are beginning to refuse quotes to certain electric models.
He said: ‘I know some of the finance companies still haven’t got the brains around residuals. I’m talking about used cars, but all of that’s got to be right. There’s large finance companies who won’t finance Teslas, or they won’t put a residual on a Tesla. We’ve got to sort that out.’
He added: ‘Alphera won’t put a residual value on a Tesla, for example and then you’ve got finance companies putting shorter periods on electric cars as well.
‘We’ve had a few 10-year-old EVs, and they’re fine. We’ve got a 147,000 mile Hyundai Kona and it drives like it’s brand new, you wouldn’t even realise it had done the mileage – better than an internal combustion engined vehicle.’
Speaking about EV sales more generally, Seaman said that electric models are doing well, although things could be impacted by upcoming changes in incentives.
He said: ‘We do fairly well with EVs, but most of the customers going to EVs are quite aspirational.
‘Obviously, they will be liable for tax, but for that type of customer I think it will affect their mindset. Also, there is still a jump in value for a vehicle registered before April 2017 because of the tax and the customers know it.
Next year will also see the removal of electric cars being entitled to the Expensive Car Supplement which is an added tax for vehicles that have a list price exceeding £40,000.
While EVs are technically still exempt, Seaman says that things are already starting to change.
He added: ‘In the car supermarket world, we had a BMW and we couldn’t sell it and I couldn’t figure out why we couldn’t sell it, it was the cheapest one.
‘It was the customer who told me it was £39,950, but it had three options that had taken it over £40,000.’
The Car Dealer Podcast, sponsored by JATO, sees an industry guest join our hosts to discuss the motor trade’s biggest headlines of every week.
A full list of the stories discussed on this week’s episode can be found here.
You can listen to all episodes of the Car Dealer Podcast on Spotify, or wherever you get your podcasts.
Story by Cameron Richards
