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Car dealerships expect strong sales growth in 2014 driven by offers in the new car market, according to Baileys Nissan and JCB Group

14 March 2014
by Chris Price

After the best year since pre-recession times, the new-car market is gearing up for another boost with the new 14 registration plates.

It is not surprising that Brian Smith has been turning up for work with a big smile on his face of late.

The Baileys Nissan dealer principal saw his firm register about 300 new cars in 2013, up from about 260 in 2012.

The new Nissan Qashqai is helping boost sales

The new Nissan Qashqai is helping boost sales

His experience is indicative of the situation for the UK’s car industry, which saw 2,264,737 cars registered in 2013, up 10.8% on 2012.

This year, Canterbury-based Baileys are looking to sell between 340 and 350 new cars.

This month is particularly exciting, with the arrival of the 14 plate for new registrations.

Brian said: “Everything is positive.

“In general terms new cars have been strong for the last 18 months.

“That’s because more cash is sloshing around after people receiving PPI payments and manufacturers pushing the UK market with fantastic offers.

“It’s a perfect storm of good news.”

Baileys Nissan dealer principal Brian Smith

Baileys Nissan dealer principal Brian Smith

It is hard to disagree with Brian. On average, an additional 600 cars were registered per day in 2013 than in the previous year.

In 2014, the Society of Motor Manufacturers and Traders (SMMT) expects the market to stabilise with sustainable growth of about 1% over the year.

With the new registration plates coming out, Baileys is looking at an order increase of about 15% on last year but even that does not tell the full story.

With the new Nissan Qashqai arriving this month, orders are already up year-on-year for April, May, June and July.

Brian added: “Overall we are looking at an order book which is 25% up on last year.”

The good spell has boosted confidence so much the Canterbury dealership is looking to grow, rather than just survive.

 “The market is a buyer’s market. The manufacturers are still very competitive with each other. The deals out there are very strong..." - JCB Group fleet manager Toby Winyard

Brian said: “We are looking to take people on because we are looking at the market expanding not only this year but next year and the year after that.”

It appears good news stories in the car sector are popping up regularly.

Maserati appointed family-owned Motorline to operate its latest new dealership and workshop facility in Bircholt Road, Maidstone, which opened in mid-January.

Meanwhile the company-car sector is also experiencing growth.

JCB Group has dealerships in Ashford and Medway. Fleet manager Toby Winyard said: “The market is a buyer’s market. The manufacturers are still very competitive with each other. The deals out there are very strong.

“What you can get on vehicles now compared to a year ago makes you realise how much they are fighting for customers, with things like sat nav and leather seats as standard.”

Last year, JCB sold 1,300 company vehicles, to big companies like KPMG and small one-man-bands.

The market had already picked up by 2012, selling about 1,200 but it was 2011 and 2010 which were tough for fleet.

“This year will be better than last,” said Toby.

“It’s the manufacturers who drive the market and decide how many cars get sold in which country.

More dealers are handing over keys than previous years

More dealers are handing over keys than previous years

“All of them have an appetite at the moment for the UK. It’s good news for buyers.”

SMMT chief executive Mike Hawes said: “We expect new car registrations to remain stable in 2014 as customers return to a more regular replacement cycle.

“With 2013 its best year since a pre-recession 2007, the UK new car market has helped stimulate the country’s economic recovery.

“While the European market is only now showing signs of improvement, the UK has consistently outperformed the rest of Europe with 22 consecutive months of growth.

“The 10.8% increase in 2013 reflects the attractive financial offers available as well as increased demand for more technologically advanced new cars.”

While the new car market is taking off, conditions are much tougher for used car dealers.

JCB Group used vehicle manager Stewart Hebditch said: “Used cars are more challenging this year than last because of the popularity of new cars.

“There’s a massive amount of manufacturer driven deals at the moment.”

The popularity of personal contract purchase (PCP) deals are proving a major sweetener for new cars, where buyers pay a contract to drive the vehicle while ownership is retained by the funding company.

Stewart added: “It’s cheaper in terms of financing, rate and deposit, which is driving people towards the new car market.

“But I don’t think used car sales will go down. We will have to work harder to get to where we need to be.

“People are looking for a bargain and if you can get a new vehicle, now, for less money, then people are going to do that.”

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