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New car sales lowest for 14 years
publication date: Jan 7, 2010
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author/source: Robin Roberts
New car sales last year were 1,994,999 units, the lowest level since 1995, the SMMT said today. December sales rose 38.9pc to 150,936 units and nearly 21pc of these were due to the scrappage incentive which is due to expire at the end of February. “The December new car market was boosted by the Scrappage Incentive Scheme and consumers looking to avoid January’s VAT increase,” said Paul Everitt, SMMT chief executive. “The 2009 market of 1,994,999 new car registrations was significantly above early expectations and reflects the positive impact of the scheme, due to end in February. “Another tough year awaits the UK motor industry in 2010, with new car registrations expected to be below 2009 levels and only limited recovery in the van and heavy commercial vehicle markets. Sustaining the progress made in the latter part of 2009 will require stronger demand from fleet and business buyers, alongside the greater availability and affordability of credit and finance,” he continued. Average new car CO2 emissions fell by 5.4pc on the 2008 level to 149.5g/km in 2009 as a result of older models being replaced under the scrappage scheme. Last year’s new car sales of under 2m are likely to be repeated for up to five years, one analyst predicted yesterday. After the SMMT said the 2009 sales were the lowest since 1995, David Raistrick, UK Manufacturing Leader at Deloitte said, “December’s surge has helped the automotive sector’s 2009 performance end on a high; with last year’s total new car registration figures just shy of 2 million units. “Despite all the predictions of doom and gloom, the annual total is not that far off where it has been for the majority of the past 30 years. Undoubtedly the scrappage scheme can be credited with keeping the market afloat and numbers close to historic levels. “2010 figures will be affected by the impending end of scrappage, the increase in VAT and the rising input costs resulting from the fall in sterling. My prediction is that there will be a dip in 2010 to around 1.7 to 1.8 million units, with the figures balancing out in 2011 to a long term annual average of just under 2 million units. “Only since the late 90s have we seen annual figures over 2 million units which many industry experts believe were due to additional registrations being forced on the market rather than due to consumer demand. The long term average for the majority of the past three decades has been less than 2 million units per annum. “For the immediate future, it is unlikely that we will return to the heady days of the past decade where unit numbers have been over 2 million. These numbers were unsustainable and a market correction has been expected for some time. Certainly over the short to medium term (3-5 years), annual registrations will remain sub 2 million.” |
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