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V-plate fall-out hits October

Dealers are bracing themselves for a tough final six weeks of trading in 1999 as customers delay new-car purchases until the new year, anticipating a cut in list prices.

The retailers are resisting carmaker pressure to pre-register vehicles for fear of being caught with excess stock at the year end, when many companies have to report final financial figures.

The traditional trade pattern of destocking before the financial year-end has been thrown into confusion by the plate change in September – one month later than previously – and massive pre-registering during that month to support the market.

Adrian Rushmore, Glass's Guide chief car editor, estimated the “natural demand” in September had been around 315,000 units, rather than the 387,000 cars registered. As a result carmakers had held back in October “from asking dealers to pull the same trick twice”.

He said: “There was some evidence of pre-registration in the last few days of October but I am not convinced it was any worse than last October. You have got to remember that manufacturers force the market every single month.

“The massive pre-registering in September has created an additional burden on dealers trying to wash cars out of the system. They have been successful at doing that, but generally they are moving them on at cost.”

This trading analysis casts serious doubts on an Society of Motor Manufacturers and Traders estimate of 2.2m units for this year. Registrations in October were 3.6% down at 149,614 and year-to-date registrations are down 1.45% to 1,969,710. The three-month running total (August to October) reveals the true extent of the slump, down more than 25% on the same period last year.

“The sales pattern has now been established with September and October,” said Mr Rushmore. “There is nothing to suggest things will get better and some evidence to suggest it could get worse.”

Across the country, dealers are reporting difficult trading conditions. One said: “We are only achieving sales through monumental discounting and pre-registration.”

Mitsubishi importers Colt Car Company claimed 26% of new car registrations in October were recorded in the last five trading days and a spokesman said as many as 512,000 vehicles could be pre-registered this year.

The SMMT claimed the October figures were in line with expectations and that demand was slowing. Registrations to small business customers were up by 21.6% but major fleet business was down 5.2% and private car registrations down by 6.2% on the same month last year.

The best selling car in the month was the Ford Fiesta but star performers included the Peugeot 206 at number five and the new BMW 3 Series which was inside the top 10 for the second month running.

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