The company's managing director Kevin Wale believes that, while there are challenges ahead for the company, new diesels and all-new models will boost product awareness.
Wale said: 'Last year was another record year for the industry and Vauxhall was number one in the fleet market for the first time ever. We would like to have another strong year, but it all depends on how much competitive reaction there is out there.
'The release of the new Astra in May will impact on sales and we will have a new diesel engine in other strong-selling models. I think our product line-up is second to none at the moment.'
One of the key developments for Vauxhall during 2004 will be the addition of new common-rail diesel engines in the Vectra and Signum range.
With the exception of the low-volume 3.0-litre V6, the larger cars are lacking a modern diesel engine. Most rivals are able to offer high-pressure common rail or pumpe duse technology, and some comply with Euro IV emissions rules.
Soon Vauxhall will gain access to a four-cylinder common rail diesel through the General Motors-Fiat alliance.
The engine, which will be Euro IV compliant from its launch, will be offered in the Vectra and Signum, and later in high-performance diesel versions of the new Astra.
The strategy of 'leveraging' engine technology from one part of its business to be offered on a global scale is also being applied to other products as Vauxhall tries to boost its niche car offering – a key tactic in attracting more user choosers to the brand.
The first of these products will be the Vauxhall Monaro – a 328bhp V8 coupe priced at under £30,000 – which is sold as the Holden Monaro in Australia and Pontiac GTO in North America.
Wale said: 'Part of our global strategy is to leverage products around the world and in the UK we would like to bring in exciting niche products provided we can service and distribute them.
'What we want to be in a position to do best on the reaction to cars like the Monaro is continue with niche products and see how the market reacts to them.'
The UK car market has bucked European trends with consecutive record years for new car sales, but Wale does not believe 2004 will be another record-breaking year.
He said: 'We don't see the market declining – we think it will be stable this year. Our challenge is that there is more competition in all segments of the market than ever before.'
One of the challenges facing all volume manufacturers is to continue to make traditional upper-medium sector cars attractive as fleet choice lists increase, and vehicles like the Vauxhall Vectra and Ford Mondeo lose out to prestige badges, MPVs and SUVs.
But Wale does not propose any radical changes for the sector. He said: 'We have seen evidence that the sector is shrinking and I think it will lead to a reduced choice of bodystyles and a possible reduction in the number of powertrains offered.
'But the upper-medium sector is still too big to switch focus and concentrate on non-conventional cars. People still have a lot of choice and can select cars to suit their own lifestyles and tastes.'
Vauxhall has a reputation in the UK as a leading provider of ready-converted LPG Dualfuel vehicles, but the position of LPG in the marketplace is now under threat from expected rises in fuel duty and a lack of Government funding.
Wale is frustrated at the sudden change in policy towards gas-powered vehicles, which resulted in PowerShift grants drying up with five months of the financial year left to run and the Treasury hinting at imminent rises in forecourt prices.
Wale is not happy about the situation. He strongly criticised the Government for making it difficult for LPG users to plan ahead, but insisted Vauxhall was still dedicated to the cause.
He said: 'We are very disappointed with the lack of clarity and the mismanagement that enables funding to dry up before the end of the financial year. We are committed to LPG, we think it's a sustainable technology for improving emissions and is well proven.
'It has worked very well in the UK market and I would like to see it continue. We'll have to see what happens, but with the Government policy as it is, you can't invest in this business if there is going to be a change in strategy with no clear indication of where we are going in the long term.
'We believe investment in LPG is justified as a way of reducing emissions and we haven't seen any coherent studies that have indicated LPG is not worthwhile.'
He added that where LPG was no longer an option for customers, they were not automatically switching to diesel instead but continuing with petrol cars.
Despite the attack on volume cars from the premium sector, where vehicles like the BMW 3-series comfortably outsell cars like the Vauxhall Vectra in terms of overall sales, Wale said it was important to resist the temptation to move the Vauxhall brand upmarket.
Although there have been messages recently from top GM executives that the brand would be taken upmarket, Wale said Vauxhall was still firmly rooted in the volume sector.
He said: 'There is always a desire to move our products upwards within each of their segments and in order to compete in a segment successfully we need to continue to improve technology and the quality of our cars. But we certainly don't mean to be a niche player. We are a mainstream player but we want to be at the top of our respective sectors for brand image, and we will do that gradually through improvements in quality and technology.'