Fleet News

Cap HPI data shows new car price rise of 38% in past decade

Row of parked cars

The average price of a new car has risen 38% over the past decade, according to automotive data experts at Cap HPI.

The average offered price of cars has increased from £24,383 in February 2008 to £33,559 in February 2018.

The experts argue that while cars sold today are fitted with much more technology, from satellite navigation to self-parking, the increased cost is not always reflected in the price rise.

New technology is often rolled out as standard by manufacturers seeking to improve the competitiveness of their products, said Cap HPI.

Matthew Freeman, managing consultant at Cap HPI, explained: “The real driver of this is the changing structure of the marketplace.

“Over the past decade, we’ve seen more expensive models being rolled out. We see more SUVs on our roads, and they are usually more expensive than the equivalent saloon.”

The company’s data also reveals more premium brand cars across almost every segment and premium brands experimenting with new segments.

The expansion of diesel ranges has also driven up the average price of a new vehicle as diesels are around £1000 more expensive than the equivalent power petrol version.

Freeman said: “Many brands have moved to offer a more luxurious specification mix and eliminated their entry-level specifications. This is partly a response to PCP making cars more affordable, and consumers moving up to more expensive models. It’s also worth noting that those base models were not especially desirable in the used market, and had poor resale values.

“PCP has also shifted focus from the entry price to the monthly repayment and having a model to advertise as ‘From £9,995’ is no longer a priority – cars are more likely to be advertised on their monthly payment.”

Click here for electric cars and hybrids best practice and procurement insight

Leave a comment for your chance to win £20 of John Lewis vouchers.

Every issue of Fleet News the editor picks his favourite comment from the past two weeks – get involved for your chance to appear in print and win!

Login to comment

Comments

No comments have been made yet.

Related content

Compare costs of your company cars

Looking to acquire new vehicles? Check how much they'll cost to run with our Car Running Cost calculator.

What is your BIK car tax liability?

The Fleet News car tax calculator lets you work out tax costs for both employer and employee