So maybe we’re not doomed after all. Certainly not if you believe the bits of the media that are extrapolating strong sales on the high street into a total avoidance of the recession that previously seemed inevitable.
Well, sorry to be the gloomy old voice of reason - but a quick trip to your local car showroom will demonstrate that one bit of the economy is already being ravaged by the early effects of the dreaded ‘R’-word.
Yes, punters may still be happy to splash cash on barbeques and garden furniture (quite possibly instead of taking a holiday in the actual sun), but after a tour around some of my local dealers I can report that the car trade is going into hibernation.
Traders are telling me that they’re keeping their money in the bank rather than buying stock. One admitted that he hadn’t bothered going down to the auctions for weeks. He said that price expectations are still high but that nothing much is happening: even diddy superminis that do 45-plus mpg aren’t selling that well. The problem is that most buyers come with part exchanges, which will be equally hard to shift. That means either insultingly low offers or polite refusals, gumming the whole system up.
Traders with garages attached are finding they still have occupied ramps and so class themselves as busy – even if they’re not being rushed off their steel toe-capped feet. Indeed these small operations stand a far better chance of surviving, whether punters opt to mend their existing car or trade out of it.
At the other end of the market, things look positively stormy. As I noted a few weeks ago, showrooms are starting to close. Meanwhile share prices for the big PLC dealer groups have taken a dive, and a receptionist in a gleaming franchise admitted to me that people just aren’t coming in to place orders for the new reg plate.
Sorry to be the harbinger of doom, but on the current showing things are going to get far worse before they get better.