The Government is ramping up plans for the switchover from analogue to digital, and will accelerate towards it over the next few years.
That’s according to Digital Radio UK, the organisation managing the move and promoting DAB usage. Ford Ennals, the organisation’s CEO, says: “The radio switchover we’re planning with Government will impact just about every single motorist in the UK. There will be an announcement [about the switchover] in 2013.
“[The Government] will only announce the precise time of the switchover when 50% of all the listening is digital. We think this will be achieved by 2015.”
An increasing number of vehicle manufacturers are fitting DABs as standard, but the concern for businesses is the potentially negative residual value impact of vehicles lacking digital radios when they are defleeted.
Laurence Harrison, technology and market director at Digital Radio UK, tells BusinessCar: “The feedback we’ve had from [RV experts] Cap is that at the point the switch is confirmed, they believe that RVs will change. You wouldn’t necessarily have a high value on a car with DAB but you would have a low one on a non-DAB car.
“Fitted as standard and available as an option works out at about 55% [of new registrations]. The problem with this option is that it’s expensive, so we think fleets are unlikely to spec it because of this. It de-risks it for fleets if it’s standard. [Fleets] want to be buying as many standard-fit DAB vehicles in advance as possible.”
Harrison said 95% of the vehicle parc would have to be converted at the point of switchover, either by standard fitment or retrofitting. He pointed out that many franchised dealer groups either have or are in the process of establishing services to professionally retrofit systems to existing vehicles, which would rectify the issue of future RV implications. However, he stressed that vehicles fitted with the systems as standard, from new, represented the most attractive and practical option for the business car community.
Fleet favourite BMW is latest manufacturer to make DABs standard across its entire range (this came into effect from January 2013). Cap believes the move is likely to see rivals quickly follow suit, as a spokesman explains: “Experience tells us that where the Germans lead, others follow, and we therefore expect most manufacturers to start making it standard across their ranges in the coming year to year and a half. Whether other manufacturers will follow BMW’s lead in specifically increasing prices [by around £300 per car] to cover it remains to be seen.
“Technological features on cars tend not to retain much of their new cost when it comes to disposal. Consumers have a tendency to simply expect them, rather than pay more, once the technology has been well established in the marketplace. Disposers often assume a feature will add value when the truth is that it is the absence of a feature that devalues a vehicle.
“Therefore, rather than expecting higher values on disposal due to DAB, fleet managers should recognise they are just maximising their chances of quick disposal. Currently the cheapest fully fitted DAB radio conversion kits are around £150. If the switch-off of the analogue signal does go ahead then fleet managers can be certain that trade buyers will take account of the conversion cost after that.”
