Growth in company car registrations

The growth in company car registrations – up 16.8% on January, 2014 – has helped the new car market get off to a strong start in 2015.

Fleet and business registrations combined equated to 97,220 units in January, 2014, up from the 83,269 cars registered during the same period last year, figures from the Society of Motor Manufacturers and Traders (SMMT) reveal.

Overall, registrations grew 6.7% in January to 164,856 units - the strongest January since 2007 – with fleet and business registration accounting for 59% of the market.

Mike Hawes, SMMT Chief Executive, said, "These figures mark an encouraging start to the year after a very strong 2014, with a strikingly robust company car market as businesses take advantage of the attractive finance offers currently available.

"January saw increased uptake of both petrol and diesel cars, while demand for alternatively-fuelled vehicles continued its surge with registrations rising by 60.8%. Registrations of plug-in vehicles were particularly strong as consumers responded to a greater choice of makes and models delivering lower running costs.

"Last year's 9.3% rise in the overall market was fuelled by stronger than expected economic confidence and, for 2015, we expect to see some levelling off throughout the year: demand is back to pre-recession levels following record-breaking growth."

Fleet registrations have been increasing consistently since 2012 as UK business confidence has bounced back since the recession. Just 882,415 cars were registered to fleets in 2009; this grew to 1,178,416 in 2014.

The SMMT says that the strong pound means that manufacturers can offer attractive finance packages to fleet buyers in the UK.

David Raistrick, UK Automotive Leader at Deloitte said: “The UK new car market is closing in on three years’ worth of unbroken comparative growth with a positive start to 2015.

“With this trend originally having been largely supported by the private buyer, it will be interesting to see whether the initial reported growth in business related sales in January continues through 2015. 

“Clearly, it is too early to confidently predict whether this will be the case. Yet with a number of new and refreshed models available aimed squarely at the fleet sector, it may well be that fleet will regain its position as the largest player in the new car market.

“There is also no sign of any reduction in overall levels of manufacturer support or low rate finance, which will also help the retail market to remain buoyant.

“However, businesses may be casting a wary eye at the recent developments in the Eurozone. With the impact of the Greek election result still unclear, it is possible that the relatively positive messages coming from the Eurozone towards the end of 2014 may be undermined.

“Until there is some clarity as to what the effect on the European markets may be, UK businesses may hold off investing in fleet renewal programs until they are confident that there will not be a detrimental effect to the UK economy.

“Indeed, the recent Deloitte Chief Financial Officer survey found that CFO’s were becoming more risk averse, with deflation and weakness in the euro area a growing concern.

“Overall, our prediction remains unchanged for 2015, with overall sales for the year unlikely to exceed 2014 levels.”

Top five fleet registrations in January