Credit isn’t the only thing being crunched at the moment. And, as you’re reading this copy of AM, I’m guessing you’ll have first-hand experience of what I’m talking about: the crisis that’s gripping Britain’s car industry.
I don’t use the word ‘crisis’ lightly. But it’s becoming more apparent with every passing day that today’s economic woes aren’t just affecting the banking sector.
Our new car market is in equally deep waters right now. Who’d bet against motor retailers and even manufacturers experiencing the same fate as has befallen Lehman Brothers?
September’s sales plunged by more than a fifth compared with the same month last year down to 330,295 – worryingly low for one of Britain’s two golden sales months of the year.
We’ve become depressingly used to bad news from the car market in recent months and trade body the Society of Motor Manufacturers and Traders is nudging its forecasts downwards, as 2008 is currently tracking at 8% lower than last year.
GM, Bentley and others are cutting production, component suppliers are already making redundancies and Paul Everitt, the chief executive of the SMMT, admitted we’re in “the most difficult economic conditions the industry has faced in 17 years”.
I could go on, but you get the picture. UK plc is a tough place to sell cars right now. But there is a glimmer of hope.
Car sales won’t dry up entirely – millions of cars will still be bought and sold every year in this country.
But car manufacturers and dealers need to wise up to the sort of models the newly cash-worried buyers want.
It’s telling that the mainstream brand to post the biggest rise last month was also the purveyor of the smallest, most fuel-efficient cars: Smart, whose sales rose 9%.
Says it all, really.