PREDICTIONS that high-emission fleet cars could suffer a dramatic fall in their residual values and blow a hole in company budgets will prove unfounded, according to Glass's Information Services.

Fears had been raised that residual values could suffer as company car drivers hand back high-emission vehicles to avoid tax increases under the new carbon dioxide-based company car tax system from April.

Although there will not be a flood of early car returns, there is expected to be a 'noticeable' shift which could affect the used car market, experts had warned.

But Adrian Rushmore, managing editor of Glass's Information Services, said. 'High emission cars will not necessarily be a turn-off to private motorists who do not pay BIK tax. However, the downside is that these cars will be offered back to the trade in the quieter months of May and June when prices normally ease back anyway.

'It is likely that we will see a slight recovery in the used prices of nearly new diesels and low CO2 emission cars on the back of a continued shortage of new oil-burners.'

For CAP Network, lessons to be learned in the New Year have changed little from 2001, it said, as vehicles have to be sold in CAP Clean condition to achieve their expected values, although since the start of the year prices have improved.

CAP Black Book said in its January editorial: 'Many fleets are reporting good conversion rates at auction and that includes average condition and high-mileage cars that sometimes struggle to even attract a bid.'