Registrations drop 11.5 per cent year on year - but the results were better than expected

New car registrations in the UK dropped by 11.5 per cent year on year in November, a result better than originally forecast.

Figures released by the Society of Motor Manufacturers and Traders reveal a total of 139,875 units were registered last month, with demand from the fleet sector helping to offset private sales that have stuttered since the scrappage incentive scheme was withdrawn earlier this year. Total sales were up 14 per cent on November 2009 if scrappage volumes are discounted.

New car registrations are expected to finish 2010 at just over 2.03 million units, which would be two per cent up on 2009. December’s sales are likely to be buoyed by motorists look to beat the VAT rise in January.

SMMT chief executive Paul Everitt said: “Next year will continue to be challenging as consumer spending tightens and the government’s austerity measures take effect.”

The UK’s best-selling car last month was again the Ford Fiesta, although demand for superminis has decreased since scrappage ended.

Our Verdict

Ford Fiesta
Fiestas sold in Europe are ostensibly the same as those sold in America and Asia

The seventh-generation Ford Fiesta is the UK's best selling car, helped by frugal engines, handling verve and a big car feel

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Comments
4

6 December 2010

"Next month’s sales are likely to be buoyed by motorists look to beat the VAT rise in January."

Which month does this refer to? With the delivery times quoted by many manufacturers surely its already too late to avoid the VAT increase, unless, of course, more manufacturers offer to absorb the extra cost..

6 December 2010

[quote catnip]Which month does this refer to? With the delivery times quoted by many manufacturers surely its already too late to avoid the VAT increase[/quote]

Not true. Registrations in December are usually low, as people prefer to wait until January to take delivery of their new car (so it's a 2011 car rather than a 2010 one). However, last year and this year, people generally prefer to have a car that's 'a year older' and not give the government any more tax than they need to. Plus there is inevitably demand for anything currently in stock and available for the same VAT reason, so dealers will have a better chance of getting rid of cars they have so far been unable to shift.

6 December 2010

There is no guarantee that all manufacturers will pass on the VAT rise at the start of January, I expect some will absorb this initially to stimulate sales growth a bit longer.

6 December 2010

[quote disco.stu]Not true. Registrations in December are usually low, as people prefer to wait until January to take delivery of their new car (so it's a 2011 car rather than a 2010 one). However, last year and this year, people generally prefer to have a car that's 'a year older' and not give the government any more tax than they need to[/quote]

Vat doesnt go up until the 4th January so there is no need to have a 2010 reg car if you want a 2011.

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