New Car Sales Were Hit Hard In 2008
Thanks to the credit crunch many motor manufacturers have been hit hard
It is almost surreal, but according to almost every official news agency and survey completed it is none the less a matter of fact now. Car Gap Insurance buyers should note that although the number of new cars sold in the UK in 2008 fell by around 11% from 2007 to only 2,131,795, according to the Society of Motor Manufacturers and Traders (SMMT), GAP insurance will become most important to new car owners when new car prices plummet and car depreciation increases!
The annual figure for new cars sold in 2008 was the lowest we have seen here in the UK since 1996, following eight consecutive devastating monthly falls during the year for manufacturers. Motor sales fell 21.2%, a fifth, in December, compared with the same month 2007. To put this into perspective for you, it means that overall vehicle sales came in at approximately 105,000 vehicles. This is however a big improvement on November, which saw sales fall by 36%, the biggest drop seen since 1980. It is thought that the drop in the VAT rate enticed some consumers.
Only a handful of manufacturers had an increase in sales in the UK during 2008. Most notably, with the biggest increase in sales, the humble SMART car rose by 43% on 2007; surely a sign of the times, in a year in which fuel prices soared and the government announced a plan of car tax changes based on engine size and emission levels.
Only 13 manufacturers managed to hang in at a respectable single-digit decrease in sales, but many firms- including Vauxhall, Toyota, Mini, Seat, Citroen, Peugeot, Honda, Bentley, Land Rover & Rover- heralded Britain's slide into recession; posting double-figure falls in sales across the board. Luxury & executive cars along with 4x4s bore the majority of the brunt. Sales ranged from only 1 to 30 in some of the higher end manufacturers!
Top Ten Selling New Cars of 2008
- Ford Focus - 101,593 vehicles sold
- Vauxhall Corsa - 99,574 vehicles sold
- Ford Fiesta - 94,989 vehicles sold
- Vauxhall Astra - 90,641 vehicles sold
- VW Golf - 65,029 vehicles sold
- Peugeot 207 - 53,462 vehicles sold
- BMW 3 Series - 49,384 vehicles sold
- Ford Mondeo - 44,150 vehicles sold
- Vauxhall Zafira - 43,169 vehicles sold
- Vauxhall Vectra - 42,555 vehicles sold
The list naturally includes the usual suspects of the great first car, the sporty hatchback, the "super mini", the executive, the family MPV & saloons.
The Ford Fiesta was the best-selling vehicle in December 2008, but the top seller for the whole of 2008 was the Ford Focus. Interestingly, Vauxhall have scooped four of the top ten - not bad for having posted a massive year-on-year decline. Or is is just that old adage which proclaims that the more you have, the harder you fall?
It's not come as a great surprise to hear that Ministers have asked to meet car-makers at the earliest opportunity to discuss possible financial help. But the industry is frustrated at the speed which this is happening, it was first expected before Christmas. It is now hoped that a decision will be made this week (12th January 2009). However it may well be too late for some already. Car companies have cut production, & jobs, to match the lack of demand. Many manufacturers have ceased production in various areas of the UK already. Honda in Swindon is currently closed for 3months, also cutting its team at F1. Jaguar Land Rover has announced redundancies of nearly 1000 in the West Midlands already. Nissan closed their factory in Sunderland before Christmas & will be shedding more than a 1000 jobs shortly. Vauxhall has also offered workers sabbaticals of up to nine months on reduced pay. There are more manufacturers considering temporary closure & redundancies.
A cash injection to the UK car industry is being hailed as essential for its survival. Especially as now that the US government has bailed out Ford General Motors & Chrysler with £11.6bn. This was hard to achieve. The car makers were sent away from the first round of talks having achieved nothing. However, the loan has strict terms attached. The car makers have until the end of March to prove they are able to operate, or the loans will be recalled. They have also taken drastic steps to cut costs. Chrysler’s factories are being closed for one month. GM has sold parts subsidiary ACDelco & is trying to find a buyer for Hummer. Last week the US Senate voted against plans to give GM & Chrysler an extra £9.3bn.
It is thought that the government is discussing a similar deal for Jaguar Land Rover. The company employs 15,000 in Merseyside and the West Midlands and was bought by Indian company Tata for £1.15bn earlier this year. But it will now have to extend to others. The government is also expected to allow manufacturers access to a Bank of England scheme for banks which would help them raise cash to offer as finance to would-be buyers. These proposals are likely to prove controversial.
Remember that you don't have to have a brand-new car to be eligible for gap insurance
. Click4gap will cover vehicles up to seven years old, and with depreciation at crazy levels, it would be wise to think now about protecting your investment in case the worst really does happen.
If you are thinking of buying a new petrol, diesel, diesel turbo, battery, duel fuel, petrol hybrid or even diesel hybrid fuel cell vehicle then you should carefully consider the merits of buying GAP insurance
to protect yourself from the losses new car owners experience due to depreciation. For a free no obligation quote click on our main menu quote button or phone us on 0844 357 8300 (Maximum call charge from a BT landline is 5p a minute. Calls from other networks may vary) quote for gap insurance.
For more information on how you can easily buy gap insurance for your new car even if they offer to sell you their own dealership gap insurance policy please contact us.
The opinions expressed are those of the author and are not necessarily held by the Click4Group unless specifically stated. The material is for general information only. Always obtain independent, professional advice for your own particular situation.