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Large cars losing residual value

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Cars with larger capacity engines are worth less on the used car market than smaller, more economical models.

According to car valuation firm Glass's, larger cars are struggling to hold their residual values when compared with more economical models, which also benefit from cheaper car insurance.

Medium-sized models are being hit the worst with their values on the used car market dropping.

Figures show that after one year and 12,000 miles a Vauxhall Vectra 1.8-litre petrol Design five-door (2008 '08-plate) model has a trade value of £7,650, while its 2.2-litre counterpart is worth £6,700.

Jeff Paterson, chief car editor at Glass's, said: "The days of larger engines automatically meaning higher prices are clearly over. Motorists' budgets are tighter than ever, making thirstier models much less desirable than their more efficient, lower-capacity siblings.

"While this is a trend that has been in play for many years, it is now gathering momentum as UK motorists gravitate towards more frugal cars and chase smaller insurance premiums and lower rates of road tax."

The current trend is bad for motorists looking for a cheap small car, but drivers opting for a high-power model will be more likely to find a bargain.

© Press Association 2009