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Croucher tells finance conference that 2.2m new car sales could be achieved again

Major car manufacturers are confident of hitting a two million unit new car market next year in the UK after finding the first half of 2010 was more robust than expected.

Matthew Croucher, Society of Motor Manufacturers and Traders (SMMT) economics manager, told delegates at AM’s Finance Conference 2010 the first and second quarters of this year where much more robust than expected despite fears that the UK would see a double dip recession. 

Croucher is now confident this won’t happen. He said: “I don’t think we’ll see a double dip. The market will continue to improve after 2011.”

The SMMT had originally predicted a 1.6m market for 2010, but it’s constantly having to reforecast as the market changes and is now looking at a much more optimistic 2.03m market.
Dealers believe the true size of the market will actually be closer to 1.8m.

Croucher admitted that some commentators are taking a more pessimistic view on how well the market will perform next year.
He said: “We believe private sales will continue to slow, but fleet business will stay firm.

“I don’t think the market will ever return to the highs of 2.5m in the long term, but we could get 2.2m or even 2.3 million by 2012 and beyond.”

Croucher predicts that CO2 levels will be a “key element of competition” for manufacturers which they will continue to push down into next year and beyond. 

Delegates were interested to hear about Croucher’s predictions for the size of the electric vehicle market next year, but he said potential was so uncertain it was “impossible to make an estimate”.

He said: “There’s a consensus towards electric vehicles as the alternative fuel of choice, but there’s still a lot of uncertainty there. 

“The technology is still too expensive for it to take off as a mainstream product as this stage.

“Electric vehicles and alternative fuelled vehicles could take up to 20% of the total UK market, but it’s very difficult to predict how it’s going to take off.”

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