Light CV manufacturers are flooding the market with heavily discounted vehicles as the fleet and rental markets continue to collapse, which in turn is eroding operators' assets, according to Volkswagen commercial vehicle director Simon Elliott.
He says: "There are such 'distressful' deals out there at the moment that the market is being confused rather than stimulated.
"Because certain manufacturers are not winning any rental business due to the downturn, they've got too much stock on the ground and therefore are transferring the same sales terms (from the rental market) into other sales channels.
"That's just causing confusion and distressing the market, affecting everyone's residual values. An operator may have bought several vans at what they think is a competitive price, however the previous week several thousand units were shifted at a severally discounted rate, affecting residuals."
He believes that certain brands are now being avoided by buyers as the situation becomes more serious.
"Brands such as Volkswagen, Mercedes and Ford are not going down that road, but some of the others are. We've been told there are certain manufacturers that operators won't touch in case of being burned."
Elliott also believes that the current economic period will also be one of consolidation in the light CV industry with a significant shift towards the second-hand market as financial resources became scarce.
"The economic climate means that the used market is more important than ever and therefore we're putting more resources into this through advertising, both national and dealer-based, and giving dealerships better access to used vans."
Elliott also predicts that Volkswagen will see a decline of around 24% in business for the year but believes it can grow market share during this period to over 9%.