UK new car registrations reach 10-year high

Almost 2.5 million new cars were registered in the UK in 2014 – the most in a calendar year since 2004.

Fleet and business registrations accounted for 52% of the market, equating to 1,296,936 units, which was up 8.9% on the 1.2 million cars registered in 2013.

Mike Hawes, SMMT chief executive, said: "UK new car registrations returned to pre-recession levels in 2014, as pent-up demand from the recession years combined with confidence in the economy saw consumer demand for the latest models grow consistently and strongly.”

Overall, last year was fourth-largest of all time; only 2002, 2003 and 2004 saw more cars registered.

It means that the UK remains second largest market in the European Union (behind Germany and ahead of France, Italy and Spain), and recorded second-largest growth of these top five EU markets.

Every month in 2014 saw an increase, with December’s 8.7% rise the 34th consecutive month of growth.

For fleet and business registrations, December recorded a 10.6% increase compared to December, 2013, with 101,649 units registered compared to 91,844 the previous year.

There was also huge growth for the plug-in car market, which saw volumes quadruple from 3,586 in 2013 to 14,498 in 2014.

Hawes continued: "The year was particularly strong for alternatively-fuelled vehicles as increased choice, coupled with a growing desire for reduced costs and greater efficiency, resulted in a quadrupling of plug-in car registrations over 2013.

“With a variety of new plug-in models expected in 2015, this area of the market will continue to grow significantly. For the market as a whole, we expect a more stable 2015 as demand levels off."

As fleets seek lower running costs, demand for more efficient cars has grown, and the BVRLA expects to see average CO2 emissions for the lease fleet fall below 120g/km of CO2 for the first time in 2015.

The association also predicts a continued trickle away from diesel cars into smaller-engined petrol or hybrid vehicles.

BVRLA Chief Executive Gerry Keaney said: “2014 was a great year for the retail and fleet motor industry. New fleet registrations hit a seven-year high, up nearly nine percent on 2013, and we saw consistent growth in the fleet leasing sector, with volumes up around 6%.

“We expect to see a further, steady increase in new leasing volumes this year. Demand for vehicle finance continues to grow – particularly from consumers, SMEs and salary sacrifice customers.”

According to the latest data from Oxford Economics, the UK rental and leasing sector purchases more than 1.5million vehicles (including 308,000 UK-made vehicles) per annum.