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Monday, 7 January, 2002, 12:23 GMT
UK car sales hit record
Annual sales of new cars in the UK have surged to a record 2.45 million, motor industry chiefs have said.

UK car sales rose 10.7% last year, shattering a 1989 record of 2.3 million, the Society of Motor Manufacturers & Traders said.

Best selling cars in UK, 2001
1: Ford Focus
2: Vauxhall Astra
3: Peugeot 206
4: Ford Fiesta
5: Vauxhall Corsa
6: Ford Mondeo
7: Renault Clio
8: Renault Megane
9: VW Golf
10: Citroen Xsara

Source: SMMT

The SMMT credited the rise, which defied the global economic slowdown, to low interest rates and cheaper car prices.

"This was a year in which the sun shone on new car buyers with a more competitive market than ever before and a raft of enticing new models," the society's chief executive, Christopher Macgowan said.

The society also nudged up its forecast for 2002 sales from 2.22 million to 2.3 million.

Differing fortunes

Industry watchers warned, however, that the figures did not spell large profits for UK car makers, which have in recent years shed jobs amid a difficult period for manufacturers.

"There is a split between the car market and the car industry here," said Professor Garel Rhys, of Cardiff Business School.

Top manufacturers, 2001
1: Ford, 404,334 (+8.0%)
2: General Motors, 310,526 (+4.6%)
3: Peugeot, 206,116 (+9.0%)
4: Renault, 181,651 (+12.7%)
5: Volkswagen, 172,848 (+11.0%)

Source: SMMT

UK manufacturers saw their market share slip to less than one quarter last year, seeing MG Rover overtaken by Citroen and Toyota in the manufacturers' table.

"Demand for imported cars rose each month in 2001, with French and German imports doing especially well," the SMMT said.

Winners and losers

Citroen saw its UK car sales surge by more than one half to 128,703 cars, the fastest growth rate among high-volume producers, with Volkswagen and Renault also reporting double digit rises.

But Ford maintained its top ranking status, largely thanks to brisk trade in the Focus model, which topped the UK sales league every month last year.

Among makers of luxury cars, Mercedes Benz and BMW both achieved sales growth of about 20%, with Audi hitting a 25.2% figure.

And Jaguar/Daimler saw sales rise by almost one half to 22,119 cars.

Ford-owned stablemate LandRover achieved 16.8% growth.

But many other UK-based manufacturers fared less well, with MG Rover seeing its market share slide below 4%, and sales fall below 100,000.

Borrowing costs

The SMMT credited strong competition between carmakers for helping push prices down, attracting trade in particular from private motorists who bought 22% more new cars last year than in 2000.

The price decreases also followed a government clampdown on the UK car industry.

Demand has been further stoked by reductions in borrowing costs, as the Bank of England cut interest rates to among their lowest for 40 years.

The figures come against a backdrop of resilient consumer confidence, which some economists have warned may prompt the Bank to increase interest rates.

The BBC's Jeff Randall
"Car salesmen have never had it so good"
Al Clarke, Society of Motor Manufacturers and Trader
"It is the quality of the workforce"
Car dealership owner Jason Pickerell
"Consumers have got a better deal"
See also:

04 Jan 02 | Business
UK consumers 'over-spending'
04 Jan 02 | Business
US drivers keep on truckin'
06 Nov 01 | Business
Car sales shrug off gloom
04 Oct 01 | Business
Car sales defy doomsters
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