New car registrations fell by 2.5% to 61,868 units in February, but the drop was in line with industry expectations ahead of the plate-change in March.
Despite new car registrations having fallen in the first two months of 2012, figures from the Society of Motor Manufacturers and Traders show the market remains within 0.8% of last year, appearing broadly stable.
Paul Everitt, SMMT chief executive, said: "The February new car market was broadly in line with industry expectations with a welcome increase in private retail activity.
"The March market will provide a much better indicator of industry health than the relatively low volumes traditionally seen in February.
"It is extremely important that the Chancellor uses this month’s Budget to strengthen consumer and business confidence by encouraging private sector investment and avoiding any further squeeze on living standards."
The private sector of the market appears to have stabilised, up 2.1% over the first two months of the year after a modest 0.6% rise in February.
Diesel car registrations rose by 4.9% in the month, which pushed their market share to 53.9%, up on 50.1% a year ago. Registrations of alternatively fuelled cars also edged upwards in February.
February typically accounts for little over 3% of annual registrations, ahead of the registration plate change in March. Some 350,000 new ‘12-plate’ cars are expected to be registered in March, 2% below the 2011 market.
The Ford Focus was the best-selling model in February, ending an 11-month run at the top for the Ford Fiesta.
The dual purpose segment again saw strong growth in February, supported by new models. Supermini registrations fell in February but are up for the year-to-date by 2.9%, representing 35% of the total market.
SMMT forecasts the full year market to be 1.92 million units, just below last year’s 1.94 million units.
This stability in the market place is heavily dependent, as ever, on the state on the economy at large. The industry is looking to the Chancellor in his Budget on March 21 to find ways to stimulate the economy, maintain stability in all motoring taxes and duty regimes, sustain support for low-carbon transport markets and to boost the availability of affordable credit.
View from the RMI
Sue Robinson, director of the RMI National Franchised Dealers Association (NFDA), said: "Although the new car market was down last month, it is positive to see an increase in private registrations highlighting that consumers are slowly coming back to the market.
“February tends to report a low market in unit numbers, particularly in retail sales, as consumers wait for the plate change on the March 1. Encouragingly we have reports from dealers that there has been a small increase in footfall during February which we are hopeful will translate to an increase in sales during March.
“Consumers over the past few years have changed their buying patterns for vehicles based on the key driver of ‘value for money’. This has not only seen changes in the types of new cars that have been purchased but has also seen an increase in interest in used cars, particularly nearly new ones. This has translated into prices of nearly new vehicles remaining firm and in some cases increasing in value.
“The NFDA is working with David Raistrick, partner at Deloitte, to gather market information around buyer trends and forecasting.”