New car sales in the United Kingdom reached the highest level in five years in 2013 as sales of 2,264,737 cars, up 10.8% on 2012, beat the Society of Motor Manufacturers and Traders (SMMT) 2.25m forecast.

December 2013 saw the 22nd consecutive monthly rise.

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SMMT expects a “stable” 2014 market with “sustainable growth of around 1% over the year”.

“With its best year since a pre-recession 2007, the UK new car market has helped stimulate the country’s economic recovery,” said SMMT CEO Mike Hawes.

“While the European market is only now showing signs of improvement, the UK has consistently outperformed the rest of Europe with 22 consecutive months of growth. The 10.8% increase in 2013 reflects the attractive financial offers available, as well as increased demand for more technologically advanced new cars. We expect new car registrations to remain stable in 2014 as customers return to a more regular replacement cycle.”

Since 2007, the UK market has shifted away from the Upper Medium segment towards smaller cars in the Mini and Supermini segments, as well as the MPV and Dual Purpose segments.

Change in buying patterns has been driven by demand for smaller, more fuel-efficient models, as well as the greater versatility offered by vehicles in Dual Purpose and MPV segments.

Dual Purpose sales overtook Upper Medium volumes in 2013 to become the third largest segment.

The Supermini segment remains the largest by volume, with a market share in 2013 of 35.9%.

All sales types recorded growth in 2013, although it was the private sector which saw the largest volume gain.

Improving consumer and business confidence, after an extended hold-off period and a competitive market place helped fuel sales growth.

Increase in private registrations accounted for two-thirds of overall market growth. In 2013 private buyers accounted for 47.5% of the market, up from 45.5% in 2012.

Registrations of hybrid and plug-in cars rose 20.5% in 2013 to 32,715 units.

In 2011, plug-in vehicles (pure electric, plug-in hybrids and range extenders) accounted for 4.5% of combined plug-in and hybrid sales; this increased to 11% in 2013.

Within the past two years the number of plug-in models on sale has increased from six to 17.

The UK has been a key market in an otherwise subdued European economic marketplace. In 2013, the UK consolidated its position as the second largest market in Europe after Germany.

The Spanish market, supported by its own scrappage scheme, saw volumes rise 2.1% in 2013, while the German, French and Italian markets all fell.

See also: ANALYSIS: A note on the UK car market

For data tables, click on Press Release