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Used car guide CAP said today the large numbers of new cars financed on PCP will not lead to oversupply in the future.
CAP said PCP growth is not a problem for those exposed to future residual values and dismissed concerns over the issue.
In January this year KPMG raised concerns over the impact PCPs would have on residuals.
Gold Book senior editor, Dylan Setterfield, said: “We do expect there to be more PCP part exchange vehicles coming to market but we do not expect there to be enough volumes to adversely affect the market in the short term.
“For vehicle sectors where new car supply is a significant factor in used car price changes, increases in registrations have already been incorporated into our forecasts. However, it is also important to emphasise that the increase in PCP is not synonymous with new car sales growth.
“A lot of the growth in PCP is cannibalised from other sales channels, whether that be other credit options or outright purchase.
“There is also a fear that these vehicles will all come back in 3 years’ time and some observers have been peddling scare stories to this effect.
“The reality is that manufacturers are putting offers together on a wide range of durations and the vehicles will come back at different intervals.