Car sales fall as scrappage bites the dust

NEW car sales plunged 17.5 per cent year-on-year in August after the scrappage scheme was phased out, figures showed yesterday.

The Society of Motor Manufacturers and Traders (SMMT) data revealed that sales had dropped for the second consecutive month, after falling by 13 per cent year-on-year in July.

The biggest fall was in private car purchases which were down 38 per cent on a year ago.

Analysts said the end of the scrappage scheme – which gave owners cash incentives to change their vehicle – had contributed to the fall, as well as uncertainty over the economy among consumers.

SMMT chief executive Paul Everitt said: “Conditions will remain challenging through the rest of the year. The industry enjoyed a better-than-expected first half and, despite difficulties, SMMT is forecasting that new car registrations will close just ahead of 2009 figures.”
A total of 55,305 new cars were sold in August.

Howard Archer of Global Insight said: “Sales were still being lifted in the early months of the year by the car scrappage scheme that finished at the end of March.”