New car sales in the UK are at their highest level since before the recession, according to figures expected to be released later this morning - with the market boosted by the volume of PPI compensation payouts.
The Society of Motor Manufacturers and Traders (SMMT) says it expects that new car sales rose by about 10.5 per cent to 2.26 million in 2013 - the highest total since 2007. Private car buyers are driving the market, with new cars sales in this segment up 15 per cent; fleet buyers saw volume growth of just 4 per cent.
Behind the improvement, says the SMMT, is a strengthening in consumer confidence, the lower running costs of the very latest models, better access to attractive finance deals and the compelling appeal to buyers of certain new vehicles, such as the compact Range Rover Evoque, a runaway success.
The SMMT also said there was 'anecdotal evidence' that payouts for missold PPI payments were also 'a factor'. At a typical rate of £2,000 to 3,000 they may be too small to, say, boost the housing market, but are ideal as a deposit on a new car. The irony of crooked bankers helping rebuild an economy they wrecked will be lost on few, at least in public perceptions.
"With the UK economy looking increasingly positive, we can expect strong underlying demand for new cars to continue into 2014" said Mike Hawes, SMMT chief executive, though he cautioned sales might only rise 1 per cent this year.
With a new generation Mini being built by BMW in Oxford, a Bentley SUV for Crewe, and a mark two Nissan Qashqai designed and built in Britain the SMMT also predicts UK production will, by 2017, exceed its all-time record set back in 1972, of just under 2 million cars: That would make Britain second only to Germany in the size of its automotive industry.
UK Best sellers 2013 (to November)
1. Ford Fiesta
2. Ford Focus
3. Vauxhall Corsa
4. Vauxhall Astra
5. VW Golf
6. Nissan Qashqai
7. BMW 3-series
8. BMW 1-series
9. VW Polo
10. Peugeot 208