The new car market continues to be a UK success story

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New car market set for positive 2015

The UK’s new car market is in line to enjoy another successful year, a Deloitte commentator has indicated.

Thursday 8 January 2015

The UK’s new car market has been a major success story over the past year, according to a Deloitte expert, while further positive signs should be seen in 2015.

The latest industry data from the Society of Motor Manufacturers and Traders (SMMT) shows that new car sales exceeded 2.47 million last year, beating the 2013 total by 9.3%.

It marked the strongest annual reading in a decade, while sales were also 8.7% higher than December 2013.

Beating expectations

Responding to the figures, David Raistrick, UK automotive leader at business advisory firm Deloitte, said the new car market beat expectations last year.

He said that while demand for new models may start to level off this year, a “measured” market reaction will be needed.

The expert added: “Current levels are hugely positive and flat sales this coming year, or even a slight reduction, should still be seen as a positive position and not a tale of woe.”

Mr Raistrick said it is important to remember that sales of new cars amounted to less than 1.95 million just a few years ago.

‘Success story continues’

The SMMT reported that sales have now increased over 34 months in a row, setting a new record.

Over the coming 12 months, this “success story” should continue, Mr Raistrick believes.

He stated: “There is no immediate indication that finance costs will increase, with the possibility of an interest rate rise receding as inflation remains below the Bank of England’s target.

“Higher levels of employment should give more private buyers the confidence to make a purchase. Finally, the continuing troubles in the eurozone will encourage manufacturers to support the UK’s buoyant market.”

Emerging trends

Deloitte estimates that new car sales will be broadly similar to those seen in 2014 over the course of this year, or they may be slightly lower.

Mr Raistrick said that a number of new trends could have an impact on the market.

For instance, lower fuel prices, upcoming pension reforms and a potential rise in nearly-new vehicle stocks may play a part, he concluded.

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Copyright Press Association 2015

“Higher levels of employment should give more private buyers the confidence to make a purchase. Finally, the continuing troubles in the eurozone will encourage manufacturers to support the UK’s buoyant market.”

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