The new emissions-based company car tax scheme is strongly influencing the types of vehicles that company car drivers are selecting, but manufacturers believe the decision to acquire new vehicles is a corporate issue based on fleets' business needs and confidence for the future.
Year-to-date fleet sales were 7.3% up on the first three months of 2002 at 296,704 units, compared to 277,294 units for the same period of 2001, while business sales (to organisations running fewer than 25 company cars) were a massive 15.7% ahead at 70,460 units (2001: 60,898).
Fleet and business sales outstripped the 355,554 retail sales during the first quarter, to account for 50.8% of the new car market, and prompting some manufacturers to raise slightly their forecasts for fleet volumes for 2002.
Peugeot is anticipating a total market of 2.35 million units, slightly above the average of all manufacturer forecasts of 2.324 million, due to extended buoyancy in retail sales and returning confidence in the fleet sector.
John Taylor, Peugeot's fleet and leasing director, suggested the 7.3% rise in fleet sales in 2002 may be due to the impact of the recalendarisation of the registration plate to March still filtering through to fleet replacement cycles, alongside higher confidence in business circles.
'Last year there was a lot of talk about recessionary pressures, and the levels of contract extensions in the contract hire sector was as high as I have ever known it for many years. But the change to the tax regime determines what cars company drivers will have, not when they change them.'
Like many manufacturers, Peugeot has identified continued strength in diesel demand, improving its own fleet diesel sales by 24.1% to 13,735 in the first quarter.
Ford boosted its year-on-year first quarter diesel sales by 40.8% to 14,406 units, and the diesel share of Ford Mondeo fleet sales has risen from 21% during the first three months of 2001 to 36% this year, with future orders strengthened further by the new 130bhp common rail TDCi engine.
In real terms, the benefit-in-kind tax charge for the petrol Mondeo 1.8 is little different to the charge for the TDCi, due to the 3% supplement for diesel, but the TDCi's fuel economy is so superior that fleets are taking a corporate decision to buy the diesel, according to Russell McGill, Ford fleet marketing manager.
'For 2002 we are projecting total fleet sales of just under one million units, just up on last year but not by much,' he said.
'For Ford, Focus is doing very well (the best-selling car in the UK for the 23rd consecutive month) and Mondeo had a good March. We are selling fewer Fiestas, which is to be expected of a vehicle in run-out, but we expect sales to pick up with the new Fiesta.'
As Vauxhall prepares for the launch of the new Vectra, the company has raised its projections by a small margin for fleet sales in April, May and June, following the strength of the first quarter. In March, both the Vauxhall Corsa and Zafira topped their fleet market sectors, and Maurice Howkins, Vauxhall's fleet director said: 'Forward orders are looking strong. I believe the company car remains a great benefit for staff.'
Ensconced as the fourth best-selling fleet manufacturer in the UK, Renault grew its sales by 20.2% to 26,071 sales during the first quarter, benefiting from new Laguna's performance over its short supply in early 2001.
The popularity of the its tax-beating low emission diesel engines was clearly apparent in first quarter figures that showed a 205% year-on-year rise in diesel sales to 5,894 units, and new managing director Philippe Talou-Derible sees a solid long-term future for the company car.
'People are not moving out of company cars,' he said. 'We will see changes - some company car drivers will take diesel and some will downsize or more likely down price, but the company car sector in the UK is not going to change significantly.'
Volkswagen was another strong first quarter performer, boosting its fleet sales by 27.8% to 20,522 units compared to the first three months of 2001, and achieving third place in the fleet diesel market with a 77.2% rise to 11,472 sales.
Diesel now accounts for 56% of its fleet volume, compared to 43% for the same period in 2001, and with supply issues conquered Vincent Kinner, head of Volkswagen fleet, sees a buoyant year ahead. 'We had our best ever March, and we are optimistic for 2002 and encouraged that we have overcome our Achilles' heel which was product availability,' he said.
'We know our diesel availability will be better this year, and we undersupplied the market last year.'
In the rest of the fleet market, BMW/MINI have had an impressive start to 2002, improving sales by 11.1%, and the BMW 3-series outsold fleet favourites like the Volkswagen Passat, Peugeot 307 and 406, Renault Laguna, Toyota Avensis and Citroen C5.
Toyota also achieved double digit fleet growth during the first quarter of 23.4%, and as a manufacturer achieved its highest ever total market share of 4.74% - up 12% year-on-year.
Graham Smith, managing director for Toyota GB, said: 'The introduction of new Corolla at the beginning of 2002 is already starting to have a positive effect on our sales growth.'
Best-selling fleet cars in March
1. Ford Focus 14,669
2. Vauxhall Astra 11,234
3. Ford Mondeo 8,514
4. Vauxhall Vectra 8,146
5. Vauxhall Corsa 7,212
6. Renault Megane 5,531
7. BMW 3-series 4,768
8. Renault Clio 4,371
9. Nissan Micra 4,354
10. Vauxhall Zafira 4,309.