New car sales fall more than 7% as markets remain tough
SALES of new cars in the UK fell by 7.4% in April – the 10th successive month of decline – and an indication that the climate remains tough for the major manufacturers.
The Society of Motor Manufacturers and Traders admitted the market was challenging but has reaffirmed its commitment that it expects to see growth in the second half of this year.
Paul Everitt, SMMT chief executive, said: “New car registrations in April demonstrated continued stability in the marketplace, with demand remaining lower than in 2010, although slightly ahead of industry expectations.
“The coming months will remain challenging, but we do expect to see a return to growth in the second half of the year.”
Jaguar saw a year-on-year decline of 58.2% last month while its share of the market shrank to 0.37%. Stablemate Land Rover also experienced a decline, sales falling 28.9% compared with last April.
Ford maintained its position as market leader but its sales fell 4% and despite a 0.6% fall for Vauxhall, its market share is now edging closer to its bitter rival – 13.29% as against 13.37%.
It was a different story for the German manufacturers – BMW was up more than 16%, and Audi and Mercedes Benz both up 7%. However, some of the gloss for BMW was taken off with a large drop in sales for its usually popular Mini. Registrations of the little cars fell almost 19% last month.
John Leech, partner in KPMG’s Automotive practice in Birmingham, said despite the fall, the situation still offered hope to the major manufacturers.
“It was feared that we would see real pressure on new car sales, but these figures show a degree of resilience in the market, especially from fleet buyers,” he said.
“This comes as a relief given that new car sales are a leading indicator of UK consumer sentiment. The SMMT’s forecast that sales in 2011 would be 5% up after excluding 2010 scrappage sales remains a good prediction, although expect pressures of negative household spending to start impacting car sales over the summer months.”
While overall sales were depressed, there was still some interesting activity during the month. The latest figures show sales of diesels now outstrip those of petrol models – 52.7% against 45.9%, while although private sales were down 23.5%, fleet buyers were expanding with sales in this sector up 6.5% compared with the same month last year.
Cost-conscious motorists are also increasingly favouring alternatively-fuelled vehicles such as electric cars and sales in this sector grew by more than 48% in April.
Although the Ford Fiesta was the best selling model in the month, registrations of small cars have generally fallen – although this could still be an anomaly from the days of the scrappage scheme.
Manufacturers looking for growth areas may focus on the dual purpose and MPV sector, both of which saw registrations rise.
Click here to search TheBusinessDesk.com’s extensive archive for more stories on automotive manufacturing.
