Figures from Experian’s Insolvency and Distress Index, revealed that the total number of insolvencies in the automotive industry fell by 18% during August, compared to the same month in 2008.
The percentage of total automotive businesses in the UK that went bust during August this year fell to 0.09%, the lowest point in 20 months.
Experian said this is the first time since the beginning of 2008 that the rate of insolvency for the automotive industry has matched the rate of insolvency for the rest of the country. Previously, it had remained higher and more erratic than the national rate of insolvency.
Experian’s data also indicates a slight year-on-year improvement in the financial solidity of businesses in the automotive industry, as measured by its average distress score.
Mark Nuttall, general manager of Experian’s Automotive business, said: “This latest data suggests that automotive businesses are proving to be far more resilient than businesses in some other sectors. While the scrappage scheme has had a positive effect on the industry as a whole, these figures show that the financial distress levels among automotive businesses had started improving much earlier in the year.
“Many UK businesses are monitoring the health of suppliers, customers and partners, as well as themselves, in order to ensure they do not suffer from the impact of another business becoming insolvent. This is something that automotive businesses also need become more aware of.”