Though sales are up year on year to 24,387 units, BMW expects China to nudge the UK out of being the world's third largest market this year, local sales director Sean Green said at the week’s media launch of the new tax busting 320d EfficientDynamics saloon and updated coupe and convertible models.

“In the full year, depending on what happens after the general election, any possible increase in VAT and the fleet and business market reactions to any changes, we expect to sell around 100,000 BMW units. Last year we sold 98,683 vehicles,” Green told just-auto. 

“Already this year we have received three times the level of new model orders over the same period last year and this means we have reached half of our 2010 sales target and much of this demand has been built around the fleet industry.

“Traditionally our UK sales are half to retail buyers and the rest to fleet, business and user-chooser customers. Fleet orders picked up dramatically last September and have continued to increase so we expect the fleet and business sector to grow their share of our sales to 65%. This expectation is because many fleet customers during the recession held off changing their vehicles and extended their lease periods. But now it doesn’t make economic sense for them to do that any longer so they are changing their fleets this year.

“We welcome these four year old BMWs back into the market as our dealers are short of used cars and the residual values are high because of the stock shortage.”

Green said the 320d Efficient Dynamics saloon with 163bhp, 380Nm, 109g/km CO2, 68.9mpg performance is rated zero for the UK's vehicle excise duty under the new first year rate (aka 'showroom tax') and will cost just GBP20 a year in road tax for the second year onwards.

The model also attracts low 13% benefit-in-kind tax for company car users and that will save 40% taxpayer drivers GBP500 a year, allowing their companies a 100% first year write down allowance and expected 5% lower contract hire [lease] costs.

Green said the new economy model was priced at GBP27,245, the same as the standard 320d SE.

“We do not believe there is any point in offering less performance or charging more for an eco model as it eradicates the financial benefits. There is no point lowering the BIK tax benefits for the driver with a lower CO2 banding and then putting the on-the-road price up so the BIK costs actually increase.”

The UK market will take 60% of BMW’s total production of the new version - 3,000 units a year - a third of which are already sold. BMW UK is negotiating with head office in Germany to allocate more if demand continues to increase.