Credit Crunch Continues To Eat Into Car Companies

People are tired of hearing about it - the doom, the gloom - when will it all stop? Well, not for at least another year according to financial experts, and those who like to think of themselves as experts, namely politicians!

This IS another article about the credit crunch but before you stop reading, bear in mind that this will aim to leave you with eternal hope and a spring in your step, well if you're planning to buy a used car in the near future that is...

Let's get the gloom out of the way then and quickly speed through (excuse the pun) those car firms that have been hit hardest. Nissan had to close, only for a short period of two weeks at the end of 2008, but have had to make 1200 redundancies; the British bastion of sports car, Aston Martin, have had to let 600 employees go following an extended Christmas shutdown, and another British brute, Bentley, also had an extended Christmas break following on from a three-day week in October.

And it doesn't look like ending there as Jaguar Land Rover has 450 redundancies planned following a succession of one day production cuts at the back end of last year; former Brit, turned German giant, Mini, have a one week shutdown planned for February and have already let 300 agency staff go, and Japanese giant, Honda, announced only last week that they will have to go ahead with a four month shutdown starting in February.

Car companies just aren't able to sell cars coming off the production line, which is of course the fundamental reason why so many jobs from said companies have been lost and why the best bet for both parties - the car companies and the consumer - surely lies in the used car sales sector at this moment in time.

Such companies will be hoping, more than ever, that sales of used cars will at least plateau. Honda in particular will be thinking along these lines and will be hoping that sales of used Honda cars from Honda dealerships, as opposed to independent dealers, will continue to thrive and will at least match last years' target of 52,323 units - higher than the likes of Mercedes-Benz.

Now it doesn't take a rocket scientist (let alone an economist, or indeed a used car salesman) to deduce that less people will be inclined to splash out on a new car, or indeed a used car, during this increasingly difficult economic climate, but that doesn't mean to say that there are not consumers out there looking to upgrade their car.

And many used car sales companies will be willing to listen to bargaining more than ever. Brand specific dealers are a safe all-round bet for buyers given their expertise on whichever brand it is you're looking for, plus most of them offer decent guarantees.

For example, a used Honda from a Honda dealer will come with a minimum of 12 months warranty, plus free 24hr RAC road side assistance thrown in. The same applies for BMW and Lexus dealers. This gives the buyer peace of mind that you wouldn't get from a private sale or from other dealerships.

Buying a used car as opposed to one from the showroom will certainly be more financially prudent, as the rate with which many new cars depreciate as soon as they leave the showroom is increasing year-on-year and will only continue in that trend until the economy revitalises.

So be it a used BMW, used Mini, used Aston Martin or a used Honda - prices are dropping, and bargains are there to be had.

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