Car market boosted by scrappage

New car registration figures out today from the Society of Motor Manufacturers and Traders (SMMT) show the car market decline is easing.

The SMMT said the government's scrappage scheme had begun to deliver registrations to the market, and there were now signs the motor trade is beginning to recover.

The figures showed new car registrations fell 15.7 per cent year-on-year to June, the smallest decline since July 2008. Although demand fell 25.9 per cent in the year-to-date, the SMMT said 'cash for bangers' was beginning to aid the car market.

Paul Everitt, SMMT chief executive said: "We are now beginning to see the positive impact of the scrappage scheme translate into new vehicle registrations.

"SMMT expects the pace of improvement to increase in the coming months, but we can already see the industry making steady progress on the long road to recovery."

According to their figures, registrations to private buyers rose for the first time since November 2007, and demand for small cars also picked up. It was the Ford Fiesta which earned its place as the best selling model for a fifth time this year, and there was good news for the environment as new car CO2 emissions fell to 152.3 g/km in the first half of 2009.

Sue Robinson, director of the Retail Motor Industry (RMI) National Franchised Dealers Association (NFDA), said: "The true impact of the vehicle scrappage scheme will be felt over the next few months, as the volume of orders made via the scheme are processed and consumers receive their cars.

"It can take up to two months for a new car purchase to go from the initial order to the delivery to the customer, so most of the purchases made under the scrappage scheme have yet to translate into sales. We expect the full impact of the scheme to make itself felt from next month onwards."