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July new car registrations fall as expected

The July market for new cars has slowed as expected with units falling 13.2% by 20,703 units following 12 successive monthly rises.

The market remains up 15.1% over the first seven months of 2010 compared to 2009 and the Society of Motor Manufacturers and Traders (SMMT) expects the 2010 new car market to reach 2.018 million units, 1.2% above 2009 market.

Paul Everitt, SMMT chief executive, said: “A drop in private registrations compared to the scrappage-fuelled months of 2009 was expected and has brought the first market decline for 12 months.

“Subdued consumer confidence and a still fragile economic recovery make the outlook for the remainder of 2010 challenging, but a stronger than expected first half means full year volumes are still forecast to exceed 2009’s total.”

Alternatively fuelled vehicles (AFV) and diesel-fuelled cars both achieved record market shares in July, with AFV volumes rising by 52.6% to take a 1.4% market share and diesel volumes up 11.8% to take a market share of 50.6%. Petrol car registrations, which had benefitted most from the scrappage scheme, were down sharply.

MPV and dual purpose (SUV) segments rose accounting for one in eight new cars registered in July, while supermini and mini segment volumes fell sharply.

The Ford Fiesta was the best selling model in July, as it was over the year-to-date. 

Sue Robinson, director of the Retail Motor Industry (RMI), said: “This uncertainty amongst consumers, combined with summer holidays, the World Cup, and a desire to wait for the new 60 registration plate in September, has translated, in the current market, to decreased footfall in showrooms and, consequently, impacted on sales for the month.

“In order for the market to strengthen manufacturers need to support dealers and consumers alike, with assurances that vehicle prices will remain competitive, and by offering attractive, enticing, sales incentives, and that availability of the popular consumer vehicles is optimised to ensure consumers aren’t deterred by long waits for their vehicles.

“The Government needs to address the fragility of the market by reassuring consumers about tax rises and spending cuts. July is traditionally a quiet month in the show room, with buyers away on holiday and waiting for 60 plates, but with the right manufacturer incentives and assurance from Government, the market will strengthen again over the coming months, with the added desire by consumers to beat the VAT increase."

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