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Upper-medium sector leads price increases

List prices for volume-brand upper-medium cars have risen by 2.2%, year-on-year to the end of March, more than any other vehicle sector.

According to the latest Glass’s New Car Market Trends report, this rate of increase is in contrast to the UK’s new car market as a whole, which has experienced a slight rise of 0.6% over the past year, worth an average of £79 more per vehicle.

"The change in registration plate in March inevitably brought some added impetus to the new car market. But sales activity so far in 2005 still remains down on last year," says Alan Cole, editorial consultant for Glass’s Market Intelligence Service.

"This makes the continued easing back in list price inflation look likely for several months to come. However, we should not rule out the distinct possibility that one of the major manufacturers could increase prices, which would encourage others to follow suit."

The list prices of superminis fell by 1.7% over the 12 months ending in March. According to Glass’s, one key factor influencing this fall is the greater availability of smaller, more affordable diesel engines. Until recently, those wanting diesel power in a supermini had to opt for relatively expensive, larger-capacity powerplants that were originally developed for mid-sized hatchbacks and upper-medium family cars.

The 2.2% rise in list prices, year-on-year, for volume-brand upper-medium cars comes as a consequence of price increases across more than half of all models in the sector – many by between £300 and £500. This follows a prolonged period of virtually static pricing for most volume-brand family cars, says Glass’s.

Compact MPVs match the 2.2% year-on-year list price rise affecting upper-medium cars, although Glass’s say this is partly attributable to the arrival of several models at the upper end of the pricing spectrum, including the Toyota Corolla Verso and Honda FRV. In addition, Mazda’s lower-priced Premacy has been withdrawn from sale (in anticipation of the arrival of the Mazda5).

The new premium priced BMW X3 has helped lift average list prices for SUVs, with year-on-year rises in this sector now at 1.6%. Without the influence of this particular model the average price would actually have decreased by around £200, thanks to the arrival of several low-priced Korean models.

In the compact executive sector, list prices have risen by 0.1%. In the large executive car sector, prices have fallen by 1.1% over the past year.

The single price rise in during March was for the Audi Allroad 2.7T quattro Limited Edition Estate, which increased in price by £970, or 2.9%, to £34,080. The biggest fall in list price was for the Volkswagen Phaeton 3.0TDI V6 4Motion, which experienced an 11% drop, worth £4,495, to £36,312.

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