Does the recent announcement of a drop in new car sales from The Society of Motor Manufacturers and Traders reinforce the idea that car-buyers are picking up used car bargains instead? The SMMT have revealed that 332,476 new cars were registered in September (usually the second highest month for registrations, behind March, due to new registration plates coming into place during both these months), representing an 0.8pc decline compared to last year.
With this revelation the SMMT have announced estimated new car registrations of 1.92m for the UK this year; however this is a deviation of their last estimation of 1.93m, so only time will tell whether this holds true or not. Regardless, with the current estimation, the UK’s accumulated new registrations for the year-to-date are down 5pc from that of the same time in 2010.
September actually “outperformed expectations” (Paul Everitt, SMMT Chief Executive), which shows how sceptical our expectations have become, and there was even a 7.3pc rise in August (the first expansion for more than a year). However, with all the economy-related stories flooding our news recently it isn’t hard to understand why September still saw a decline. In addition it is worth noting that fleet volumes supported the market, making the overall figures slightly deceptive, with private registrations down 9.3pc.
Howard Archer, the chief UK economist for IHS Global Insight says, “Squeezed purchasing power resulting from high inflation, low wage growth and tightening fiscal policy,” are to blame. To be fair, it’s hard to disagree with him, we all know how volatile and fragile the economy is at the minute, and it’s no surprise this is reflected in our buying decisions. However, always being one to look for a silver lining; we might take some comfort from the fact that, from a global perspective, the UK is doing well!
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