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June new car registrations down, but pace of market decline slows

A fall in June registrations has been acknowledged as a continuation of a 12 months trend and supports the trade's belief the total market for the year will be 1.93 million units.

Figures released this morning by the Society of Motor Manufacturers and Traders reveal a fall in the new car market of 6.2% to 183,125 units.

> Download the SMMT new car registration figures

“June new car registrations continued to perform in line with industry expectations with robust demand in the fleet sector and a relatively weak retail market.

"The balance of demand makes this a tough time for vehicle manufacturers and their dealer networks,” said Paul Everitt, SMMT chief executive.

“Slow, but steady economic growth in the second half of the year should see volumes increase, although the overall market is still expected to be around 1.93 million units.”

The new car market remains down on 2010, although pace of decline moderated in quarter two in line with SMMT forecasts. While down in June, registrations fell slower than the year-to-date rate which is down 7.1% for the first half of 2011.

Registrations in quarter two fell by 5.2%, the smallest drop in each of the past four quarters (Q3 2010 down 11.0%; Q4 2010 down 17.3%; Q1 2011 down 8.7%).

And the market in quarter two was 1.4%, or some 6,500 units above SMMT expectations. Whilst the economic outlook remains uncertain, volumes have moved in line with SMMT’s full year forecast of 1.93 million units. The 12-month moving annual total currently stands at 1.95 million units.

Fleet demand continues to grow, up 2.0% in June and by 3.4% over the first half of 2011.

The pace of slowdown in the private sector has moderated, as the scrappage scheme’s impact has now all but passed.

Registrations of diesel cars rose by 4.0% in June and are up by 7.5% over the first six months of 2011.

Registrations of superminis led to an improved market share in June, up one per cent to 36.7%.

The introduction and adoption of low CO2 technologies has helped the UK new car fleet average CO2 figure drop to 138.9g/km in quarter two and 139.7g/km in the first half of the year, down from 144.2g/km in full year 2010 and 181.0g/km in 2000.

The Ford Fiesta was the best selling model in June and over the year-to-date.

The Volkswagen Golf was the best selling diesel model over the first six months of 2011, but was pushed into second place in June by the Vauxhall Insignia.

Sue Robinson, director of the RMI National Franchised Dealers Association, said: “The market reflects the still weak consumer confidence caused by inflation, job uncertainty and government spending cuts. To have a major positive impact on consumer buying, a return of consumer confidence is vital.

“Dealers need manufacturers to support the market and encourage customers to return to the showroom. There is a need for marketing and incentives that are attractive to the consumer, particularly where the consumer may save money by replacing an older, fuel hungry and less reliable vehicle.”

> Full analysis of the June and year-to-date figures will appear in our July ezine, AMe. To subscribe click here.

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