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Description

Description

“The UK car market is passing through a difficult period with combined new and used sales down for a third successive year in 2019. Conditions are not expected to improve in the short-term placing the focus of attention on how best to understand and work with the demands of buyers in both new and used markets.”
– Neil Mason, Retail Category Director

This report looks at the following areas:

  • Where next for the car market?
  • What future for manufacturers outside of the premium sector?
  • Young adults are a key audience for sales

What's included

What's included

Table of contents

Table of contents

  1. Overview

    • What you need to know
      • Products covered in this Report
      • Executive Summary

          • The market
            • New and used car sales down for a third successive year
              • Figure 1: UK new and used car sales, by volume, 2014-24
            • Polarisation evident within the car parc
              • Figure 2: Age structure of the UK car parc in years, 2014 and 2018
            • Dual-purpose cars have seen a significant expansion in their share of sales
              • Figure 3: New car registrations by category, percentage point change, 2014 and 2018
            • Interest in diesel plummets in favour of petrol and alternative fuels
              • Figure 4: Sales of new cars, by fuel type, 2014 and 2019
            • Companies and brands
              • Buyers shifting from mass-market to premium
                • Innovations are a key area for manufacturers
                  • Advertising investment is in decline
                    • German premium brands show the strongest differentiation and trust
                      • Figure 5: Attitudes towards and usage of selected brands, December 2019
                    • The consumer
                      • Nearly three quarters of adults now own a car
                        • Figure 6: Car ownership, November 2019
                      • A majority of cars in ownership were purchased from new
                        • Figure 7: Age of car owned, November 2019
                      • 61% of non-car owners don’t hold a driving licence
                        • Figure 8: Other access to cars, November 2019
                      • Smaller cars are by far the most popular
                        • Figure 9: Type of car owned, November 2019
                      • Commuting is the main use for cars
                        • Figure 10: Reasons to use a car, November 2019
                      • Digital is the most popular channel for information
                        • Figure 11: Sources of information, November 2019
                      • What we think
                      • Issues and Insights

                        • Where next for the car market?
                          • The facts
                            • The implications
                              • What future for manufacturers outside of the premium sector?
                                • The facts
                                  • The implications
                                    • Young adults are a key audience for sales
                                      • The facts
                                        • The implications
                                        • The Market – What You Need to Know

                                          • Car sector remains in a weak position
                                            • Both new and used markets have seen falls
                                              • Over a third of households consist of two or more cars
                                                • Franchised dealers continue to strengthen their market presence
                                                  • Cars are becoming more expensive for owners
                                                  • Market Size and Forecast

                                                    • Car sales remain weak with a further fall in sales likely in 2020
                                                      • Figure 12: UK new and used car sales, by volume, 2014-24
                                                    • Forecast methodology
                                                    • Market Segmentation

                                                      • Both new and used markets are in retreat
                                                        • Figure 13: New and used car market volumes, 2014-19
                                                      • Trend towards owning older cars is increasing…
                                                        • Figure 14: Age structure of the UK car parc in years, 2014-18
                                                      • … as UK car parc expands
                                                        • Figure 15: Number of licensed cars (Great Britain), million units, 1998-2018
                                                      • Cars are most likely to be used on trips of more than five miles
                                                        • Figure 16: Mode share of trips, by main mode (different trip lengths), England, 2018
                                                      • Growing percentage of households own two or more vehicles
                                                        • Figure 17: Percentage of households with car availability, England, 2008-18
                                                      • Car ownership is growing although is lowest in London
                                                        • Figure 18: Household car ownership by region (England), 2007/08 and 2017/18
                                                      • Dual/multi-purpose vehicles are becoming more popular with buyers
                                                        • Figure 19: New car registrations, by broad segment (volume share), 2013 and 2018
                                                      • Dual-purpose cars increasingly challenge smaller vehicles
                                                        • Figure 20: New car registrations by category, 2015-18
                                                      • Alternative fuelled vehicles making progress in the new car sector…
                                                        • Figure 21: Sales of new cars by fuel type, 2014-19
                                                      • … although petrol vehicles continue to dominate the wider car parc
                                                        • Figure 22: Number of licensed cars (Great Britain), million units, 2014-19
                                                    • Channels to Market

                                                      • Franchised dealers continue to strengthen market presence
                                                        • Figure 23: Sales of new and used cars, by channel, 2014-18
                                                    • Market Drivers

                                                      • More men are likely to be car owners
                                                        • Figure 24: Full car driving licence holders by age and gender, England, 2018
                                                      • Trips taken are growing but not distance travelled
                                                        • Figure 25: Trips, distance travelled and time taken, England, 2008-18
                                                      • Costs of owning a car have risen noticeably since 2017
                                                        • Figure 26: Consumer expenditure on car purchasing, servicing and repair and motoring expenses, seasonally adjusted at current prices, 2014-19
                                                      • Over half of adults plan to buy a car in the next three years
                                                        • Figure 27: Do you or someone else in your household plan to buy a car(s) within the next three years, November 2019
                                                      • Around half of buyers will purchase new in the next three years
                                                        • Figure 28: Intention of purchasing a car/s in the next three years, by new or used/second-hand purchase, November 2019
                                                      • Restrictions on using a car are growing
                                                      • Companies and Brands – What You Need to Know

                                                        • Premium marques are in the ascendance
                                                          • Innovations focus on safety and comfort
                                                            • Advertising investment is in decline
                                                              • Brands occupy distinct positions within the market
                                                              • Market Share

                                                                • Premium marques are in the ascendance
                                                                  • Volume manufacturers suffer with value brands partly to blame
                                                                    • Figure 29: Manufacturer shares of new car registrations, 2013, 2015, 2017 and 2019
                                                                  • New buyers prefer small cars
                                                                    • Figure 30: Top 10 new car models, 2018 and 2019
                                                                  • Used market sees growing presence for premium brands
                                                                    • Figure 31: Top 10 used car models, 2018 and 2019
                                                                • Launch Activity and Innovation

                                                                  • Volvo redefines its view of personal mobility
                                                                    • Drive Recorder offers improved video recording
                                                                      • AirBubbl offers enhanced indoor air quality
                                                                        • Figure 32: AirBubbl in-car air cleaner
                                                                      • Subaru Driver Monitoring System
                                                                      • Advertising and Marketing Activity

                                                                        • Advertising investment follows same track as new car sales
                                                                          • Figure 33: Recorded above-the-line, online display and direct mail total advertising expenditure by car manufacturers, 2015-19
                                                                        • Hybrids, electric and alternative vehicles represent an emerging sector
                                                                          • Figure 34: Recorded above-the-line, online display and direct mail total advertising expenditure, by type of car, 2015-19
                                                                        • Most manufacturers have scaled back investment
                                                                          • Figure 35: Recorded above-the-line, online display and direct mail total advertising expenditure by leading car manufacturers, 2015-19
                                                                        • Television is by far the most important channel for advertisers
                                                                          • Figure 36: Percentage media type split of recorded above-the-line, online display and direct mail total advertising expenditure by car manufacturers, 2015-19
                                                                        • Nielsen Ad Intel coverage
                                                                        • Brand Research

                                                                            • Premium German brands perform well for trust and differentiation
                                                                                • Figure 37: Attitudes towards and usage of selected brands, December 2019
                                                                              • Key brand metrics
                                                                                • Figure 38: Key metrics for selected brands, December 2019
                                                                              • Brand attitudes: Škoda and Kia are seen as offering good value
                                                                                • Figure 39: Attitudes, by brand, December 2019
                                                                              • Brand personality: MINI is positioned as fun while Škoda is viewed as boring
                                                                                • Figure 40: Brand personality – macro image, December 2019
                                                                              • Brand personality: Micro image analysis presents a complex landscape
                                                                                • Figure 41: Brand personality – micro image, December 2019
                                                                            • The Consumer – What You Need to Know

                                                                              • 74% of adults own a car
                                                                                • Most cars in ownership were purchased new
                                                                                  • Strong link between holding a driving licence and owning a car
                                                                                    • Smaller cars are more popular
                                                                                      • Commuting is by far the most important use for a car
                                                                                        • Digital is the most important channel for information
                                                                                        • Car Ownership

                                                                                          • Nearly three quarters of adults now own a car
                                                                                            • Figure 42: Car ownership, November 2019
                                                                                          • Personal wealth is a major factor impacting on car ownership
                                                                                            • Car ownership is growing
                                                                                              • Figure 43: Car ownership, 2015-19
                                                                                          • Age of Car Owned

                                                                                            • A majority of cars in ownership were purchased from new
                                                                                              • Figure 44: Age of car owned, November 2019
                                                                                            • Wealth strongly favours the recent purchase of a new car
                                                                                              • Young adults are more likely to have purchased in the last two years
                                                                                                • New cars are popular in London
                                                                                                  • Men prefer to buy new
                                                                                                    • Sluggish recent sales of new cars evident in ownership data
                                                                                                      • Figure 45: Age of car owned, 2015-19
                                                                                                  • Other Access to Cars

                                                                                                    • Around six out of 10 of non-car owners don’t hold a driving licence
                                                                                                      • Figure 46: Other access to cars, November 2019
                                                                                                    • Women are more likely to not hold a driving licence
                                                                                                      • Potential market for car purchasers is significant
                                                                                                      • Type of Vehicle Owned

                                                                                                        • Smaller cars are preferred
                                                                                                          • Figure 47: Type of car owned, November 2019
                                                                                                        • Smaller cars are popular with women
                                                                                                          • Opportunities exist to exploit young car owners
                                                                                                            • Wealth favours the ownership of large, luxury and specialist vehicles
                                                                                                              • New cars purchased recently mirror wider trends towards specific categories
                                                                                                                • Large cars and SUVs appeal to those with specific demands
                                                                                                                  • SUVs represent the most dynamic segment of the market
                                                                                                                    • Figure 48: Type of car owned, 2016- 19
                                                                                                                • Reasons to use a Car

                                                                                                                  • Commuting is ranked as the main use for a car
                                                                                                                    • Figure 49: Reasons to use a car, November 2019
                                                                                                                  • Young and old have different uses for a car
                                                                                                                    • Rural and urban car owners want different things
                                                                                                                      • New and used owners have different priorities for their cars
                                                                                                                        • Growing interest in SUVs fits with stronger leisure demands
                                                                                                                        • Sources of Information

                                                                                                                          • Digital dominates when it comes to information on cars
                                                                                                                            • Figure 50: Sources of information, November 2019
                                                                                                                          • Young adults favour a wider range of information sources
                                                                                                                            • City dwellers are likely to rely on less popular channels
                                                                                                                              • Television, digital and printed publications divide the market
                                                                                                                                • Information is important for new car buyers…
                                                                                                                                  • … with owners of small and large vehicles likely to use different channels
                                                                                                                                    • Repertoire analysis suggests young men favour multiple sources
                                                                                                                                      • Television losing out as interest in other media broadens
                                                                                                                                        • Figure 51: Sources of information, 2017-19
                                                                                                                                    • Appendix – Data Sources, Abbreviations and Supporting Information

                                                                                                                                      • Data sources
                                                                                                                                        • Exclusions
                                                                                                                                          • Market sizing and segment performance
                                                                                                                                            • Abbreviations
                                                                                                                                              • Consumer research methodology

                                                                                                                                              This market report provides in-depth analysis and insight supported by a range of data. At the same time, introductory and top-level content is provided to give you an overview of the issues covered.

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