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New car registrations up 8.2% in plate-change month

car purchase

The September-plate change saw new car registrations increase by 8.2% to 359,612 units.

According to the latest figures from the Society of Motor Manufacturers and Trader,  (SMMT) private registrations accounted for 49.3% of the total.

Paul Everitt, SMMT chief executive, said: "The important September plate change market outperformed expectations.

“Although the economic outlook remains challenging, we are starting to see a tentative return of consumer confidence as motorists explore new products and the latest fuel-efficient technologies."

The market has increased 4.3% to 1,620,609 units in the first three quarters of 2012, up 67,515 units.

During January-September the market increased 4.3% to 1,620,609 units. Registrations in Q3 rose 7.5%, increasing the rate of growth seen in Q1 (0.9%) and Q2 (4.8%).

This represents the best, non-scrappage impacted, quarterly growth since 2001. However the market remains well below pre-recession levels – in 2007 1.94 million cars were registered in the first nine months of the year.

New car registrations have grown every month in 2012 bar one, and September volumes were 26,112 units or 7.8% above SMMT’s forecast for the month.

The SMMT believe the growth is likely to be market specific, given wider economic concerns, boosted by attractive offers and enticing new models that offer significant fuel efficiency gains to UK motorists.

Registrations of small and dual purpose cars saw the biggest rises in the month, but almost all segments saw growth.  The Ford Fiesta was the best selling new car in September with 18,651 units and also for the year-to-date. Towards the end of October, SMMT is due to revise its full year forecast, currently at 1.97 million units as set in July.

Sue Robinson, director of the RMI National Franchised Dealers Association (NFDA), said: "September is typically a strong month for new car registrations with the September plate change boosting sales.

"There are also a number of great retail offers and finance packages currently available to consumers which are tempting people into show rooms and boosting sales. The strong increase in private registrations shows some signs of economic recovery with consumers feeling confident enough to commit to purchasing a brand new car.”

Mike Allen, Panmure Gordon executive director of equity research, support services, said: "While we believe there is some self-registration contained within the data and it does not tell us anything about margins, this looks to be a good outcome particularly in the context of the macro environment.

"Recent industry data for the used car market also looks encouraging. We maintain our view that to see a sustained recovery in the market UK GDP needs to be 2%, but would expect trading patterns across the dealer groups to be robust in light of this data. Our key picks remain Lookers and Vertu, while we have moved to a neutral stance on Inchcape over concerns on overseas growth in 2013E. Pendragon remains a Sell."

Panmure Gordon believes Q3 registrations showing sequential growth on the year (Q3 +7.5% vs. Q2 +4.8% and Q1 +0.9%) making it the best non-scrappage impacted quarterly growth since 2001, Allen said "the data is overstated with self-registrations playing a part in this".

He said: "The demise of most European markets is also playing a part on this volume growth in the European market along with the relative strength of Sterling allowing for some discounting activity.

"Indeed, we note a number of quotes from manufacturer chief executives at the recent Paris Motor Show highlighting the problems in European market.

"It will be interesting to see how margins fared against this backdrop for dealers in this environment. We therefore maintain a cautious outlook on the market given higher fuel costs, structurally high unemployment and fragile consumer confidence."

Head to the SMMT's website to download the full new car registration figures for September 2012.

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