Car sales continue to drop despite scrappage scheme

SALES of new cars continued to slide last month despite the government&rsquo;s &pound;300m scrappage scheme, new industry data revealed yesterday. <br /><br />New registrations fell 24.8 per cent in May to 134,858 units, the Society of Motor Manufacturers and Traders (SMMT) said. It is the 13th straight month of faling volumes, as consumers shun expensive purchases like cars. But the SMMT said it had seen an &ldquo;encouraging start&rdquo; to the much-lauded scheme. It said the impact of the incentive &ldquo;will take time to translate into registrations&rdquo;.<br /><br />To date, 35,000 orders for new cars have been placed since business secretary Lord Mandelson&rsquo;s cash-for-bangers scheme was announced in April&rsquo;s Budget, and went live in May. <br /><br />The data goes against evidence of &ldquo;green shoots&rdquo; seen in recent economic news such as a recovery in services.