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Market trends: City cars were the stars of 2008

No-one needs to be told how bad 2008 was: sales fell by 11.3% overall and a deeply worrying 27.2% in the final quarter.

For purveyors of big cars, it was even worse: in the last quarter, luxury saloons were down 42.5% while off-roaders slumped 45.9%.

The only segment to see actual growth was city cars which has become a mainstream part of the market for the first time.

In the third quarter, thanks to retail sales in September, city cars briefly became the third biggest segment in the UK car market, behind lower medium and super-mini. For a segment that took less than 1% of the market as recently as 1996, that is quite a turnaround.

Broadly speaking, the rate of decline for each segment depended on how big and expensive were the cars within it.

The only segments which did slightly better than one might expect were compact executive (thanks to the new A4 and C-Class) and executive, which benefited from some people moving back from off-roaders.

However, not everyone who wanted to come out of off-roaders managed to do so. Anecdotal evidence suggests that car dealers spent quite a lot of the last quarter turning away unwanted off-roaders being offered as part-exchanges. The only escape route for many owners was to change models within the same brand.

Among the manufacturers, there were some that increased sales due to new models (ironically, they included both Jaguar and Rolls-Royce), but only Volvo managed to increase sales with the same model range, thanks to the repositioning of the C30.

Meanwhile, Audi and Nissan managed to maintain sales. In the middle, Ford and Vauxhall managed to get away with a slightly smaller drop than average, as did Skoda, Fiat and Hyundai.

At the wrong end of the table, the only completely mainstream brand to get a real kicking was Renault, down 29.4% (and the other two French marques had worse-than-average falls of around 17% each as well).

Most of the other big losers were who you would expect – Land Rover and Porsche were both down about 30%.

Almost all the other brands that fell by more than 30% were weaker players, such as Saab, Jeep, Chrysler, Proton and SsangYong.
The other brand to be significantly down was petrol-heavy Lexus (down 33.1%). As Toyota’s recent loss showed, this recession is no respecter of reputations.

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