U.K. Light-Vehicle Sales Reach 5-Year High in 2013

U.K. new-car sales climbed 10.8% to 2,264,737 units in 2013, the highest level in five years and beating the industry’s forecast of 2.25 million.

The Society of Motor Manufacturers and Traders says improving consumer and business confidence after an extended hold-off period and a competitive marketplace helped drive sales growth.

The U.K. has been a bright light in Europe’s generally moribund economy as it consolidated its position as the region’s second-largest car market after Germany. It was the only European market to grow consistently throughout the year.

The U.K. market finished the year with December sales jumping 23.8% to 152,918 units.

SMMT CEO Mike Hawes says the 2014 market is expected to stabilize with sustainable growth of about 1% over the coming year.

“With its best year since a pre-recession 2007, the U.K. new-car market has helped stimulate the country's economic recovery,” Hawes says in a statement. “While the European market is only now showing signs of improvement, the U.K. has consistently outperformed the rest of Europe with 22 consecutive months of growth."

The 2013 result is seen as a positive sign the U.K. economy is growing strongly, with consumer and business confidence rising.

“Fleet and business sales were responsible for more than 50% of new-car registrations, which demonstrates the vital role road transport plays in driving the U.K. economy,” British Vehicle Rental and Leasing Assn. CEO Gerry Keaney adds.

Noting the positive outlook for 2014 with small but stable growth forecast, Keaney says in a statement: “Hopefully this growth will be well-balanced. It is vital that vehicle manufacturers take a disciplined approach to self-registrations.”

The Ford Fiesta by far was the most popular model throughout the year with sales growing 11.6% to 121,929 units. The Ford Focus followed with 87,350, up 5.1%, ahead of the Vauxhall Corsa (84,275), Vauxhall Astra (68,070), and Volkswagen Golf (64,951).

Ford remained the U.K. market leader for the 37^th straight year, boosting 2013 deliveries 10.3% to 310,865 units.

Ford of Britain Chairman and Managing Director Mark Ovenden says in a statement the brand extended its sales lead in a fiercely competitive market thanks to the launches of award-winning vehicles and technologies.

General Motors subsidiary Vauxhall was a distant second with sales increasing 11.7% to 259,444 units.

SMMT says that since 2007, the U.K. market has seen a shift away from the upper-medium segment toward smaller cars in the mini and supermini segments, as well as the multipurpose-vehicle and dual-purpose segments.

Dual-purpose sales overtook upper-medium volumes in 2013 to become the third-largest segment. The supermini segment remained the largest by volume, with a market share of 35.9%.

All sales types recorded growth in 2013, although the private sector saw the largest volume gain. Private buyers accounted for two-thirds of overall market growth and were responsible for 47.5% of the market, up from 45.5% in 2012.

Sales of hybrid and plug-in cars rose 20.5% in 2013 to 32,715 units.

Plug-in vehicles (all-electric, plug-in hybrids and extended-range vehicles accounted for 11% of combined plug-in and hybrid sales, up from 4.5% two years ago, as the number of plug-in models offered for sale rose from six to 17.

Toyota sales climbed 4.8% to 88,648 units, giving the automaker a 4.1% market share, as its Auris Hybrid became the U.K.’s best-selling hybrid model with 6,160 deliveries.

Prius PHEV deliveries grew 8.5% for the year and the hybrid outsold its nearest rival, the Vauxhall Ampera, by a ratio of more than 2 to 1.

Kia U.K. sales improved 8.2% to a record 72,090 units with the Sportage and cee’d leading the way with 20,796 and 14,021 deliveries, respectively.

President and CEO Paul Philpott says the Korean automaker has managed rental sales carefully and the dealer network has done more business with local companies than ever before.

“That means a strong and profitable network and ever-improving residual values behind the Kia brand, rather than a performance inflated from the center at high cost and with high impact on trade values,” he says in a statement.

Kia sales have more than doubled from 31,324 units in 2008 and Philpott is expecting continued growth this year, with deliveries topping 75,000.

Suzuki GB sales rose 33% year-on-year to 33,086 units, making it the region’s second-fastest growing brand in 2013. Demand for the Alto City Car was strong, as deliveries of 13,600 units moved it ahead of the Suzuki Swift for the first time as the most popular car in the range.

The commercial-vehicle market finished the year up 14.7% to 327,291 units for the best result in five years, getting a late boost with December deliveries surging 66.6% to 32,300.

Van deliveries rose 13.1% year-on-year to 271,073 units, while truck sales jumped 23% to 56,218 as the move to Euro 6 emissions standards fueled growth.

Ford CVs, with 20.9% of the market in 2013, have been the segment leader for 48 years and the Transit has led the sector since its launch in 1965. Ford medium-commercials secured 31.3% of that segment, up from a prior-year 30.7%.

Hawes says the overall CV result was boosted by a strong second half to the year as van owners and operators responded positively to the wider economic recovery.

“The introduction of new Euro 6 trucks will be of key interest to the heavy end of the market in 2014, while we expect the forthcoming launches of several new light-commercial vans to deliver further growth in this important sector,” he says.

The U.K. results were released with online marketer AutoTrader.com reporting more people are searching the Internet for luxury cars, executive models and all-wheel-drive vehicles suggesting an increasingly bullish car market where demand for larger, high-end models is growing at the expense of small city cars, small sports cars and MPVs.

The more than 466 million searches made on the website between September and November saw the focus on luxury models rise 4.1%; executive models, up 3.3%; and AWD vehicles, up 3.0%.

“While the rise in (AWD) searches towards the end of the year can be seen as a seasonal phenomenon, the corresponding surge in luxury- and executive-car searches does suggest consumer confidence has returned to the  market,” AutoTrader.com Marketing Director Jonathan Williams says in a statement.