By Michael Northcott Monday, 07 January 2013

Car sales accelerate at their fastest in a decade

Sales of new cars in the UK last year were at their highest level since 2008, with more than two million sold.

According to the latest data from the Society of Motor Manufacturers and Traders, car sales roared away at their best since recession began in 2008. More than two million brand new cars were driven off the forecourt, a 5.3% rise compared with 2011, and the biggest single jump for more than a decade.

Furthermore, growth accelerated as the year progressed, with the final quarter showing a 9.2% rise in sales, and December sales rising 3.7% compared with the same period in 2011.

The SMMT’s chief executive, Paul Everitt, said: ‘Boosted by strong consumer demand, the market grew at its fastest rate for 11 years with innovative, fuel-efficient cars keeping buyers in showrooms. Looking ahead to 2013, we anticipate the market will hold firm, with manufacturers and dealers working hard to deliver quality and value to motorists.’

Whilst the figures are encouraging, there is a downside: sales are still pretty far off from pre-recession levels. In 2007, 2.4 million new cars were sold in the UK, meaning this year’s figures are still 14.9% below the 10-year high. 

As far as car marques are concerned, Ford’s Fiesta and Focus models, and Vauxhall’s Corsa and Astra were the four top-selling models of the year. Not surprising given that they are at the smaller, more affordable end of the market. But the more expensive Volkswagen Golf came fifth, and the four-wheel-drive Nissan Qashquai sixth. 

Other notable performances were from Bentley, which saw a 22% increase in sales compared with 2011, and relatively new entrant to the UK market, Ssangyong, which saw a 351% rise in UK sales. However, the latter’s total sales in numbers were just 194 units in 2011 and 875 in 2012. 

Interestingly, most of the sales were in the private market, which suggests that perhaps many people had been holding onto their car for longer than they would usually (because of recession) but are now concerned about the cost of maintaining an old banger.

It’s similar to what happened in the corporate fleet market, where firms held onto their cars for an extra year to save a bit of money, and then that market bounced back all of a sudden, too.

Some of the biggest losers were Saab (-94%, down to 232 units - not surprising considering the company ceased trading last year), Renault (-40%, down to 40,760 units), and Alfa Romeo (-37%, down to 7,253).

Nonetheless, 2012 was certainly a good year for the UK auto industry, not least because a raft of manufacturers pledged further investment in their existing UK productions facilities, and several announced that new models will be produced in the UK, creating thousands of new jobs.

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