UK car sales have seen a remarkable level of growth over the last four years and the most recent statistics published by the Society of Motor Manufacturers and Traders earlier this week revealed that 2.63m cars were registered in 2015, representing a 6.3% increase
on the previous year. These latest figures sit above the previous record of 2.58m which was set in 2003. But what is driving the continued growth of the industry and how can contractors benefit from this market uplift?
Falling fuel prices
One of the major factors is the falling price of crude oil. Experts are now predicting that both Brent and WTI, the two international benchmarks, may sink as low as $20
. The price of crude averaged $100 a barrel between 2008 and 2014, and while the market saturation caused by continued production by the Organization of the Petroleum Exporting Countries (OPEC) may not necessarily be good news for the global market, it is without a doubt good news for motorists. Consumers saw the price of both diesel and petrol drop below the £1 mark in the New Year, a factor which is likely to contribute to the continued growth of the market over the coming months.
Against a backdrop of growth in key economic sectors and a rising UK economy, ultra-low interest rates are encouraging people to borrow once again, with figures indicating that around 80% of new car purchases in that last year were done so under some form of finance deal. As manufacturers continue to offer competitive deals and strong finance schemes, owning a car is becoming more affordable. Over the last year luxury manufacturers Mercedes-Benz and BMW both saw double digit growth, experiencing uplifts of 16.8% and 12.4% respectively. These high levels of growth are a reflection not only of growing consumer and business confidence in the market but also increased accessibility through financing.
Benefits to contractors
Growing consumer confidence, increased economic growth and affordability have all undoubtedly contributed to the record figures experienced over the last year, but how do contractors stand to benefit? McLaren have recently announced the creation of 250 new jobs in the UK as a result of record sales of 1,654
cars over the last year, launching a second production shift at its manufacturing complex in Woking. It’s likely that other automotive manufacturers will also be looking to increase production and will need to take on more specialists in the coming year. Additionally the Automotive Investment Organisation (AIO) recently announced that they have achieved their goal of creating or safeguarding 15,000 jobs
in the sector, and have attracted £1bn of foreign investment since their establishment. So with the industry expansion expected to continue throughout 2016, it’s likely that contractors will begin to benefit from the thriving sector even further as demand for highly skilled individuals increases.