New Car Sales Defy the UK Recession
Published: 3 September 2012 By MoneyHighStreet Staff Leave a Comment
Despite tough economic times and many industries suffering from lack of growth, UK car dealerships are seeing unprecedented growth with record profits of £24.1m made this quarter.
This increase of buying new has much to do with the low financing costs available to those buying cars at the moment.
People who are in stable jobs are feeling optimistic enough to spend significant amounts of money on high end cars, showing that the car industry can remain optimistic about the future.
Pendragon Plc., one of the largest motor traders in the UK, have seen sales increase by almost 16% this year in many of their stores across the country. Other significant dealerships such as Inchcape and Lookers saw sales boosts, with a 5% and 6% increase in sales respectively.
New car sales have been steadily growing all year with growth of 0.9% in the first month, and 3.3% in the next quarter despite announcements of a double dip recession.
It is however important to note that the industry is still in turmoil, with new car sales down 20% since the UK entered into the recession.
Top officials however remain highly positive, claiming that this growth is great news considering that the UK is currently in the worst financial climate since the 1960s.
Used car sales were also showing high levels of growth with top sellers announcing 12% increases in like for like sales. Lookers Plc., who recently revealed that their used car sales had increased by 11%, claimed this hike in sales is primarily down to the increased social media integration and web presence, which displays just how important social implementation is to the used market.
It has been reported that the spare parts market has shrunk, with many drivers deferring repairs in order to save money. Dealers expect this to continue to shrink until things begin to look up.
Most of the profit generated this year has been through sales of high end luxury vehicles, which have shown consistently strong figures throughout the year. One can hope that these numbers will continue to grow, though there is little knowing if this will be the case.
Land Rover and Audi have been standout manufacturers, shifting high volumes of vehicles all across the country.
It is a pattern that has been seen in other industries, with luxury fashion brands enjoying bumper profits as the wealthiest members of society continue to spend, and in some cases spend more, unaffected by the tough economic conditions affecting most of society.
But it is not just a time for the rich to make hay. With so many great financing options and cheap motor trade insurance, there are opportunities out there, and the market is looks set to carry on making steps forward.