New Car Sales Remain Subdued in the UK as Consumer Confidence Dissipates
DUBLIN, Ireland--Research and Markets (http://www.researchandmarkets.com/reports/c56593) has announced the addition of Cars in the United Kingdom 2006 to their offering.
Since 2004, the market has seen a downturn in confidence for the new car market.
Sales have fallen back with a combination of factors, most notably the concerns of a growing number of consumers about the future prospects for the UK economy. Yet illustrating the continuing love affair that Britons have with the car, the overall size of the market continues to grow as multiple car ownership per household rises.
Within the market, manufacturer activity and NPD is a major driver, although the very size of the market and different consumer demands mean that considerable segmentation of the sector exists.
Currently lower medium/small family cars are the most important market although recent years have seen growth in new vehicle formats such as MPVs and SUVs.
Issues in the Market
Definition
Advertising data
Abbreviations
Market in Brief
New car sales subdued as consumer confidence dissipates
UK car parc continues to expand while value of the market remains sizeable
Consumers opt for smaller cars in a fragmenting market
Ford leads new car market although new entrants are making good progress
Innovation remains crucial for success
Promotional support is sizeable at around 2% of market value
Block Exemption having an effect
Dealer network suffers from effects of consolidation and new channels to market
Future is for an ever more challenging market for manufacturers and dealers
Internal Market Environment
Number of potential drivers shows steady increase
Figure 1: Driving licence owned, 2002-06
Car prices remain under pressure…
…but retail prices are rising
Seasonal issues
Costs associated with running a car keep increasing
Environmental issues dominate government and public thinking
Consumers viewing themselves activists in their own right
Figure 2: Agreement with lifestyle statements about the environment, 2002-06
Safety First angle
Figure 3: Agreement with selected lifestyle statements about cars/driving, 2002-06
Broader Market Environment
Consumer confidence is down
Figure 4: Bank of England lending rate levels, 2003-06
Population changes
Figure 5: Trends and projections in total UK population, by age group, 2001-11
Women in the workplace
Figure 6: Trends and projections in the UK workforce in employment, by gender, 2001-11
Growing number of ABs
Figure 7: Trends and projections in total UK population, by socio-economic, group, 2001-11
Home on wheels
Figure 8: Agreement with statement ‘For me my car is like a second home’, by country, 2006
Block Exemption
Competitive Context
Figure 9: Expenditure priorities, 2006
Strengths and Weaknesses in the Market
Market Size and Forecast
Car parc shows steady increase while new registrations prove more variable
Figure 10: Trends in the UK car parc and new registrations, 2001-06
Value sales are slowing as new car registrations slow
Figure 11: UK new and used car market size, 2001-11
Price per new car sold is rising…
…but the market for new cars is down
Used car market is faring better
The future
Factors incorporated in the forecast
Segment Performance
Business and fleet purchases dominate sales
Figure 12: Total new car registrations, by segment, 2001-05
Top end of the market growing
Figure 13: New car sales, by product category, 2001-05
Consumers switch to diesel…
Figure 14: UK new car registrations, by fuel type, 2001-05
… with the non-private segment especially bullish
Figure 15: UK diesel sales, by private versus non-private registrations, 2001-05
Market Share
Upmarket manufacturers make inroads as market trades up
Figure 16: Manufacturer shares of new car registrations, 2001-05
Ford and Vauxhall dominate leading models
Figure 17: New car registrations – top ten, by make and model, 2003 and 2005
Companies and Products
Ford
Vauxhall
Volkswagen
Renault
Peugeot
Toyota
BMW
Citroën
Honda
Nissan
Brand Communication and Promotion
Above-the-line promotion is a significant feature of the market
Figure 18: Main monitored media expenditure on cars, 2001-06
Television dominates although shows signs of slipping
Figure 19: Main monitored media expenditure on cars, by media type, 2001-05
Major advertisers are not always major players
Figure 20: Main monitored media expenditure on cars, by leading advertisers, 2001-05
Channels to Market
New car retailing
Decline…
Figure 21: Number of UK franchised dealer outlets, 1996-2005
…and consolidation
New car dealerships by marque
Figure 22: Number of UK franchised dealer outlets, by marque, 2001-05
Used car retailing
New car boom leads to influx of nearly-new cars available via dealers
Used cars become more crucial to franchised dealers
Independent dealerships remain constrained within the market
Car supermarkets
Other retail channels
Car auction companies
Car importers
Online car retailers
Consumer 1 – Ownership and Purchasing
Ownership of cars increasing with households with two or more cars becoming commonplace
Figure 23: Household ownership of cars, 2002-06
Figure 24: Household ownership of cars, by gender, 2006
Figure 25: Household ownership of cars, by age, 2006
Figure 26: Household ownership of cars, by socio-economic group and working status, 2006
Figure 27: Household ownership of cars, by region, 2006
Purchases used car more significant than new cars
Figure 28: Obtained new or second-hand (only car or most recently obtained car), 2002-06
Figure 29: Obtained new or second-hand (only car or most recently obtained car), by age and socio-economic group, 2006
Cars purchased in the last 12 months declining
Figure 30: When obtained (only car or most recently obtained car), 2002-06
Figure 31: When obtained (only car or most recently obtained car), by gender, age, and socio-economic group and presence of children, 2006
Consumer 2 – Car Types and Expenditure
Interest in diesel growing
Figure 32: Engine type (only car or most recently obtained car), 2002-06
Two doors good, four doors bad
Figure 33: Type of car (only car or most recently obtained car), 2002-06
Larger engines are also being preferred, as consumers can get more for their money
Figure 34: Engine size (only car or most recently obtained car), 2002-06
Trading up is evident within the market
Figure 35: Amount paid for only car or most recently obtained car, 2002-06
Appendix
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