UK car market sees three straight years of growth
THE UK new car market has continued its strong growth, with figures for February showing registrations up almost 12% on the same month last year.
In total, 76,958 new cars were registered last month – sales have now risen each month for the last three years. It is the first time the UK market has seen 36 consecutive months of growth.
The UK car market’s sustained expansion is now the longest ever seen, beating the previous record of 26 months set in the late 1980s.
Fleet buyers helped to drive demand with registrations up 19.9% in that segment, while the private market saw an increase of 3.4%.
The figures, released by the Society of Motor Manufacturers and Traders (SMMT), are even more impressive because February is traditionally one of the quietest months of the year ahead of a number plate change in March.
However, dealer incentives as they look to clear their forecourts ahead of the new cars arriving are thought to have played a part in the strong figures.
Mike Hawes, SMMT chief executive, said: “Three years of continuous growth in the new car market is remarkable and reflects the strong upturn in the confidence of UK car buyers since the recession.
“Registrations of fleet and business cars have outpaced the private market in February, reflecting the increased business confidence across the UK. With most fleet car buyers on a three-year replacement cycle, many of those cars purchased at the beginning of the current growth period are now due for replacement. Over the course of 2015, however, we are expecting a more stable market to emerge given there has already been an extended period of consistent growth.”
Among the leading manufacturing BMW did particularly well. Sales of its own brand vehicles were up almost 68% last month at 5.091 (2014: 3,037), while its Mini subsidiary fared even better with growth of more than 79% – 1,756 against 979 for the corresponding month last year (although these figures are skewed because many buyers were thought to be awaiting the arrival of a new model in March last year).
Executive counterpart Audi paled by comparison with its German rival, seeing growth of just 5.6%. Mercedes-Benz fared better with growth of almost 19.5%.
Flying the flag for the UK, Jaguar saw growth of 7.8%, with Land Rover doing slightly better, up more than 9% on the corresponding month last year.
In the volume segment, Ford maintained its market lead although sales actually dipped 0.8%. Vauxhall was the only other manufacturer with a double digit market share as its sales grew by 2.4%- largely due to the twin successes of the Corsa and Astra, which were the third and fourth best-sellers for the month.
The Ford Fiesta retained the top spot but the Focus slipped to fifth in the table. Splitting Ford and Vauxhall in second spot was the Volkswagen Golf.
Commenting on the figures, Peter Gallimore, Manufacturing Partner and Automotive Lead at Deloitte in the Midlands, said: “The run of monthly comparative growth began back in March 2012 and has now reached three years without, on the surface, any immediate signs of coming to an end. However, there was an indication in January that, whilst the total new car sales maintained the trend, the momentum provided by the private consumer may be running out of steam. Indeed, the 5.1% fall in sales was the first comparative monthly fall since October 2012 and taken with today’s figures, it suggests that 2015 will require a boost from the business and fleet sector to maintain the good news story.”
His counterpart at PwC, Phil Harrold, said the figures were unsurprising given the relatively stable market and positive consumer sentiment.
“However, the size of the increase in fleet and business registrations is more surprising and is more a reflection of where we are in the cycle of business fleet replacement. Therefore we wouldn’t expect business registration increases to be maintained at this level over the next few months.
“With the positive state of the economy, low interest rates and credit available for consumers, we expect consumer confidence to remain high,” he said.
