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New car sales in freefall
publication date: Nov 7, 2008
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author/source: Robin Roberts
Sales of new cars in the UK fell in October at their fastest rate for 17 years, industry figures have shown.
Figures from the Society of Motor Manufacturers and Traders (SMMT) showed new car sales were 128,352 in October, down 23pc from a year ago. Business sales almost halved in the month and private registrations were down over a quarter.
The Bank of England has cut interest rates UK by one-and-a-half percentage points to 3pc, its lowest since 1955.
There were widespread calls from industry for a major cut as the country begins to face up to the prospect of a deep recession. It is the most dramatic cut since a two percentage point reduction in 1981.
The SMMT said 1.92 million new cars had been sold so far this year, down 8.7pc on the same period in 2007. It has also updated its sales forecast for 2008 a s a whole down to 2.15 million vehicles.
In Wales last month, 4,721 new cars were registered. That's almost 24pc less than 12 months ago. (See table at end of story)
The SMMT figures come as it was announced that production of the Mini car in the UK would be cut back.
Staff at factories in Oxford and Swindon have had their two-week Christmas shutdown extended to four weeks this year.
"October has proved another difficult month for the UK motor industry and action is needed to help restore consumer confidence and encourage buyers back to the showrooms," said SMMT chief executive Paul Everitt.
"Cuts in interest rates that are swiftly passed on to consumers, scrapping planned increases in vehicle excise duty and maintaining public expenditure on new vehicles are essential parts of the package required by industry."
He added: "There is also a clear role for European action to support continued investment in new, lower carbon vehicle technologies."
The sales fall is the worst decline since a 31pc year-on-year drop in June 1991, and means new car registrations have fallen in all but two months of 2008.
The SMMT has previously said that it believes the market may not stabilise before the third quarter of next year.
Speaking before the October figures were released, Jaguar Land Rover chief executive David Smith said people were putting off buying decisions until they had "more confidence about which way the economy is going". | |
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‘October proved to be another challenging month for car dealers, as consumers continued to be cautious about spending,' said Sue Robinson, Director of the RMI National Franchised Dealers Association.
Robinson said, "The next few months could remain difficult if the Government does not make moves to help the consumer, and business. While interest rates are falling, and will in time feed through to businesses and consumers, there are a number of other measures including tax reductions that the Government could undertake to assist the economy."
The director believes that further interest rate reductions are key to stimulating the economy.
"‘For the economy to recover, the Bank of England must cut interest rates. Confidence needs to be returned to the banking system, and consumers need to feel safe in their jobs. However, it is vital that the impact of any interest rate cuts reaches the consumer."
Robinson adds: ‘Businesses desperately need to see that the Government is supporting them. This will help shore up businesses, and prevent further job losses.'
| | | General Motors Corp. and Ford Motor Co. will report terrible third-quarter results today, ending a disastrous week in which the industry reported the worst monthly sales rate in 25 years.
Reuters predicts the two companies will each show losses of about $2 billion, excluding one-time items. GM and Ford sales in 2008 to date are running about 20pc and 19pc below year-ago volumes, respectively. |
| Top ten best sellers | UK | | October | Wales | | 1 Vauxhall Corsa | 7,570 | | Ford Fiesta | 664 | 2 Ford Fiesta
| 7,139 | | Vauxhall Corsa | 251 | 3 Vauxhall Astra
| 5,640 | | Ford Focus | 211 | 4 Ford Focus
| 5,027
| | Ford C-Max | 172 | 5 VW Golf
| 4,237 | | Vauxhall Astra | 162 | 6 Ford Mondeo
| 4,123 | | Vauxhall Zafira | 158 | 7 BMW3 Series
| 3,220 | | Renault Clio | 136 | | 8 Vauxhall Zafira | 2,689 | | Ford Ka | 133 | | 9 Peugeot 207 | 2,675 | | Toyota Yaris | 125 | 10 BMW1 Series
| 2,280 | | Peugeot 207 | 112 | | | | | |
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