Expert Blog

The new van market dips in 2017 after a record-breaking 2016

20170706_The new van market dips in 2017 after a record-breaking 2016

Van sales have grown remarkably over the past four years. In 2012, a total of 239,641 light commercial vehicles (LCVs) were registered in the UK; in 2016, that number was 375,687 – an incredible 57% increase and the highest ever total for a calendar year.

Since then, the van market has contracted slightly. According to new figures from the Society of Motor Manufacturers and Traders, 184,926 LCVs were registered in the first six months of 2017. That’s a 3.7% decline on the same period in 2016, and even slightly lower than the first half of 2015.

In part, that reflects the slowdown in the British economy as a whole. The Gross Domestic Product grew by just 0.2% in the first quarter of 2017, and is expected to grow by only around 1.6% in the year as a whole. Those headwinds are bound to have an impact on van sales.

It’s worth remembering though, that these latest figures represent a relatively small dip after years of strong growth, and van registrations are still very high by historical standards. As the graph below shows, 368,647 LCVs were registered in the year to June – down 2.3% on the previous year but still higher than any 12-month period prior to 2015. Compared to 2012, registrations are still up 54%.

The composition of new van sales has also been changing slightly over recent months. After a period of growing more than twice as fast as the van market as a whole, registrations of the largest vans (those weighing between 2.5 and 3.5 tonnes) are now falling faster than those for other LCVs. 3.5% fewer were registered in the year to June than in the previous 12 months.

Meanwhile, two types of LCV are actually continuing to grow. Registrations of medium vans (those weighing between 2 and 2.5 tonnes) are up 9.5%, while pick-ups are up an impressive 21%.

The rise of the pick-up is one of the big stories of recent years: 51,872 were registered in the year to June, more than double the 24,455 registered in 2012. In part, this has come at the expense of the 4x4, which has seen annual registrations drop from 6,279 to 1,229 over the same period.

Overall, van registrations in 2017 look set to come in a little below the record-breaking year of 2016. But the fact that levels remain consistently high suggests that van fleets are weathering the current economic turbulence relatively well.

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