PREMIUM-BRAND vehicles have increased their share of the UK’s new car market by 112 per cent, in relative terms, over the last decade, according to Glass’s Information Service.

Ten years ago prestige brands commanded just eight per cent of the market, but by the end of 2003 this had grown to 17 per cent. Significantly, 77.8 per cent of this 10-year growth took place during the last five years.

Apart from the perceived desirability of the cars, Glass’s say there are other factors helping prestige marques increase their market share.

The weakness of European economies has made new prestige cars more affordable in this country.

Alan Cole, editorial consultant at Glass’s Market Intelligence Service, said: “Lack of demand in their home markets has led, for example, German manufacturers to increase right-hand drive production in order to take advantage of the UK consumer boom.”

The continued buoyancy of the UK economy has encouraged buyers to spend more, driving sales of premium vehicles.

Mr Cole said: “With ongoing house price inflation fuelling mortgage equity release, and with interest rates still at a low level, the consumer spending boom shows no sign of abating.

“Even the prospect of further rate rises has not yet altered the feeling of relative wealth, and the affordability of finance has encouraged more consumers to spend additional amounts to get behind the wheel of a premium-sector car.”

Despite this 10-year growth of 112 per cent, prestige-badge cars still only control 17 per cent of the whole UK new car market.

Glass’s believe the strong desire to own a premium brand will ensure these vehicles continue to perform well in the used car market, despite concerns about accelerated falls in residual value.

Mr Cole added: “Relative to the rest of the market, the values of prestige-brand cars have reduced slightly during the last three years and are now stable. We see no sign of accelerated falls in values being likely in the short to mid-term future.

“The market share of the premium brands looks certain to increase as their model ranges diversify further over coming years.”