Why New Car Sales Are On the Rise in the UK
The UK automotive industry is well and truly booming. According to research by the Society of Motor Manufacturers and Traders (SMMT), the industry turned over a staggering £59.3bn in 2013. And this is only set to increase.
Surprisingly, 2014 has emerged as the year of the new car. UK new car sales have been on the rise now for 29 consecutive months, with 172,907 new cars being registered in July. This broke the records for the longest period of growth for the automotive industry since 1959. 1,460,172 new cars have already been registered in 2014 – which is 10.1% more than had been sold this time last year. So why are more and more of us currently making the decision to buy new, causing the sudden surge in new car sales?
- Irresistible finance deals
According the SMMT, every 4 in 5 new cars purchased in Britain are bought on credit. And it’s no wonder why. Most car dealers now offer Personal Contract Purchase (PCP) Plans, which offer the buyer the chance to drive away in a brand new car and pay it off in low monthly instalments. The buyer puts down an initial deposit, agrees the figure of the monthly instalments and a time period. When the agreed time period is over, the buyer can either hand the car back or buy it out at a pre-agreed price. You can find more information about PCP plans here. With attractive finance plans like these available, more and more of us who would not normally be able to afford a new car are able to drive away in the car of their dreams. With many plans including extras such as free servicing and warranties, it’s increasingly making sense to buy new.
- The end of the recession
Many UK citizens put off buying a new car during the financial crisis, due to the uncertain economic climate. Now that it is over, we have seen meant a sudden rise in the sale of new cars. During the crisis many people have had to make money saving decisions such as delaying moving home or reducing mortgage payments. This has meant that many people now have cash to spare after living so economically for the past few years.
Many people who have been burdened by the cost of repairs on used cars without a warranty have been more tempted to purchase new. It’s common knowledge that after a few years, cars are more likely to start needing regular repairs. And without a warranty, this can be very costly.
People want a car is not going to break down after a few months and the security of knowing they are protected by a warranty. And with such attractive finance deals on new cars available, it really is making more sense to buy new.
- A strong pound
The recent strong performance of the UK’s currency has resulted in cheaper imported cars, which is likely to have affected the sales of new, foreign cars. Although, the top 3 best sellers of 2014 so far have been the Ford Fiesta, the Ford Focus and the Vauxhall Corsa.Back to Blog