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Car sales dip less than expected in November
publication date: Dec 7, 2010
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author/source: Robin Roberts
New car registrations fell by less than expected in November with demand from the fleet sector helping to offset the market rebalancing following the end of the Scrappage Incentive Scheme, said Paul Everitt, SMMT Chief Executive. "Registrations are expected to fall next month, but demand may benefit from motorists looking to avoid the January VAT rise. This factor, coupled with the strength of the first half of 2010, means year-end volumes are expected to lift to over 2.03 million units, 2% up from last year. Next year will continue to be challenging as consumer spending tightens and government's austerity measures take effect, he added." At 139,875 units in November, the market was down 11.5% on last year. Diesel car volumes rose sharply to 53% in November, coupled with the slowdown in registrations of petrol cars which benefitted strongly from last year's Scrappage scheme. Registrations of alternatively fuelled cars jumped 83.5% in November to give them a 1.3% share of the November market and a 1.1% share over the year-to-date. The Ford Fiesta was once again the best selling new car in the month. Demand for supermini cars has weakened post the scrappage scheme, but volumes of dual purpose vehicles and MPVs continue to rise. Registrations are also expected to fall in December, but earlier growth in the first half of the year should ensure a net gain of around 2% to some 2.03 million units. The market is forecast to fall by some 5% in 2011 to 1.93 million units, due to the impact of the austerity measures and notably the expected squeeze on consumer spending. Sue Robinson, RMI Franchised Director, said, "Footfall in showrooms is up, according to our dealers, and for many of them November has been busier than October, which is reflected in these figures. "Dealers are not negative about market conditions but it's proving tough and they're relying on strong, robust processes to ensure sales are made, and these seem to be working". David Raistrick, automotive partner at Deloitte, commented, "November's 11.5% fall in car registration figures is another blow to the automotive industry as numbers decline for the fifth consecutive month. While it was always unlikely that the figures would exceed last year's, which were fuelled by scrappage, the recent cold snap has not helped given that people have been kept away from showrooms. "Today's figures are a stark reminder of the challenges that lie ahead for the motor industry into 2011. I think it is unlikely that we will see a pre New Year rush from consumers looking to save the additional VAT which comes into force from 4 January, and I expect December's figures to remain flat. "As consumer and business confidence remains unsettled, it is doubtful that either private or business sales will grow in the New Year. I stand by my prediction that new vehicle sales for 2011 will be closer to the 1.8 million unit mark."
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