Best month for new car sales in more than five years as new '63' plates and PPI windfalls drive demand

  • More than 400,000 cars were registered in Britain this September
  • This is the most since March 2008, and a 12.1 per cent increase on 2012
  • Sales to private buyers were up 17.9 per cent since last year

Car sales in Britain accelerated to a five-year high last month as rising consumer confidence led to more than 400,000 new registrations.

More new cars were sold in September than in any month since March 2008, with sales up 12.1 per cent on the same month last year.

Sales to private buyers – householders hardest hit by the downturn – were up 17.9 per cent.

Soaring sales: One in seven cars sold in September were made in Britain, including the fourth biggest seller of the year so far, the Vauxhall Astra. Pictured, the Vauxhall Motors factory in Ellesmere Port

Soaring sales: One in seven cars sold in September were made in Britain, including the fourth biggest seller of the year so far, the Vauxhall Astra. Pictured, the Vauxhall Motors factory in Ellesmere Port

The 403,136 new registrations in September mean that Britain is on track for 2.2million sales by the end of the year – making it the best year since 2007, when sales hit 2.4million just before the economic crash.

Significantly, more than one in seven new ‘63’ plate cars registered in September were built in UK factories such as those belonging to Jaguar Land Rover, Vauxhall, Mini, Nissan, Toyota and Honda.

The Ford Fiesta was the best-selling model, followed by the Vauxhall Corsa, Ford Focus, Volkswagen Golf and Vauxhall Astra.

Mike Hawes, chief executive of the Society of Motor Manufacturers and Traders, which compiled the figures, said it was a ‘fantastic’ month.

‘The UK market is reflecting growing economic confidence,’ he said.More than 400,000 cars were sold in September, the largest monthly total since March 2008, with experts suggesting windfalls from PPI mis-selling claims unlocked a wave of demand from buyers.

Total sales were almost 50,000 higher than in the same month last year as the new September 63 plate also helped boost sales, the Society of Motor Manufacturers and Traders said. 

The SMMT said payment Protection Insurance compensation payouts helped the industry as motorists choose to use the cash as a deposit on a new vehicle.

The total number of cars sold in September was 403,136. This is 12.1 per cent higher than the same month last year and the largest for more than five years.

SEPT NEW CAR SALES

1. Ford Fiesta - 20,629

2. Vauxhall Corsa - 14,464

3. Ford Focus - 14,295

4. Volkswagen Golf  - 12,265

5. Vauxhall Astra - 11,014

According to the statistics, 1,794,924 cars have been sold so far in 2013. At the same point last year, 1,620,609 has been shifted while more than one in seven new cars registered in September was built in Britain. 

Popular models including the Vauxhall Astra – the fourth biggest seller of the year - are made in Ellesmere Port, Cheshire.

The Ford Fiesta, Vauxhall Corsa and Ford Focus were the most popular cars in September and also of the year so far.

The biggest selling manufacturer of the year is Ford, shifting 249,017 cars. This time last year they had sold 224,369. 

A noticeable entry to the list is bargain car manufacturer Dacia which offers the cheapest brand new cars available in Britain – it has so far sold 11,631 motors.

Top ten: Ford lead the way with new car sales so far this year, shifting nearly 250k motors. The blue shows sales in 2013, the red line sales in 2012 for each manufacturer

Top ten: Ford lead the way with new car sales so far this year, shifting nearly 250k motors. The blue shows sales in 2013, the red line sales in 2012 for each manufacturer

Britain sales race ahead – but Europe has its handbrake on

Of the five major markets – Britain, France, Germany, Italy and Spain – only Britain has seen growth in the new car market this year.

 

Recent statistics from the European Auto Manufacturers’ Association said that in France, sales have slumped 9.8 per cent, Germany by 6.6 per cent, Italy 9 per cent and Spain 3.6 per cent.

Howard Archer, chief economist and IHS Global Insight, said: 'Very strong sales in the key month of September are particularly good news for the car industry while also providing more evidence that the economy is sustaining its improved performance. 

'In fact, car sales have been robust through 2013, which is in marked contrast to the weakness seen across most of Europe.

'The motor industry will be hoping that the recent improvement in UK economic activity is sustained and extended, and that this leads to further strengthening in consumer and business confidence, and their willingness to splash out on new cars.'

How PPI claims are helping the industry

Refunds from PPI mis-selling are running at about around £500 million a month, with more to come.

Keith Lewis of the SMMT, said: ‘People have been getting an average of £3,000 back from PPI claims, which isn’t enough to pay off the mortgage or replace the kitchen but it is enough for a deposit on a new car.

‘We think there is still a year to go of PPI repayments and it is really boosting the market.’

According to Dean Bowkett, chief editor of global services at car website Glass.co.uk, Britons are currently in a better position to purchase a new car than their European counterparts – and PPI is helping this, alongside cheap finance.

He said: ‘My view is that potential buyers in the UK are still benefiting from Payment Protection Insurance windfalls, cheap finance and high discounts.’

USED CAR VALUES CONTINUE TO RISE WHILE MILEAGE HAS FALLEN

Data from vehicle remarketing specialist British Car Auctions has found that used car values continue to rise.

Last month, the average used car cost £7,007 – up by £692, or 10.9 per cent, compared to last year.

It comes as the average mileage of motors sold at BCA has fallen. It is down by roughly 1,500 miles compared to last year, while the average age was static at just under 63 months.

Simon Henstock, BCA’s UK operations director, said: 'There has been a growing sense of general economic optimism over recent weeks and that feel-good factor has definitely been apparent in the wholesale used car market.  

'September proved to be an exceptionally strong month at BCA, with average values well ahead year-on-year.  And despite volumes beginning to rise towards the end of the month, demand outstripped supply comprehensively throughout September.'

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New car sales best month in over 5 years as '63' plates and PPI windfalls drive demand

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