Car sales slowdown continues despite impending VAT rise
Published: 6th Dec 2010 10:50:02
Sales of new cars in the UK fell for the fifth month running in November, despite the looming VAT rise.
Registrations were down 11.5% versus a year ago, according to the Society of Motor Manufacturers and Traders (SMMT).
However, fleet cars sales rose 6% as companies sought to beat the January rise in VAT to 20%, and the SMMT said the 26% fall in private sales was less than expected for the same reason.
The government's Scrappage Incentive Scheme inflated sales last year.
The programme expired in May this year, and since July sales have been consistently below those recorded during the scheme's year-long operation.
Stripping out previous car sales linked to the scrappage scheme, the SMMT claimed in its November report that underlying sales were actually up 14%.
"Registrations are expected to fall next month, but demand may benefit from motorists looking to avoid the January VAT rise," said Paul Everitt, SMMT's chief executive.
"Next year will continue to be challenging as consumer spending tightens and the government's austerity measures take effect."
The SMMT expects car sales to be up 2% overall this year - thanks in part to a relatively strong December - but to then fall 5% next year.
However, David Raistrick, automotive partner at accountants Deloitte, played down the chances of a pre-VAT sales rush, saying he expects December figures to remain flat.
"Today's figures are a stark reminder of the challenges that lie ahead for the motor industry into 2011," he said.
"As consumer and business confidence remains unsettled, it is doubtful that either private or business sales will grow in the new year."
Meanwhile, diesel car sales continue to overtake those of petrol cars, accounting for 53% of the market in November, and 46% for the year to date.
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Harvard CitationBBC News, 2010. Car sales slowdown continues despite impending VAT rise [Online] (Updated 6th Dec 2010)
Available at: http://www.ukwirednews.com/news/113430/Car-sales-slowdown-continues-despite-impending-VAT-rise [Accessed 25th Apr 2014]
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With the doors to its brand new £1million training centre officially open, one of the UK's leading apprentice training providers, Bristol based S&B Automotive Academy, is showcasing its world-class facilities by launching a series of foreign student exchanges for the first time in its 41-year history. To get a flavour of what life is like as an apprentice in the UK, the Academy hosted 16 apprentice engineers and bus drivers from the G9 Automotive College in Hamburg, Germany, as part of a Europe-wide vocational training initiative called the ‘Leonardo Programme’ with support from the European Social Fund. In a reciprocal arrangement, S&B will be sending nine apprentices to Germany during February 2012 so that they can get an appreciation of life in the automotive industry on the Continent. A further three German exchange groups are being planned for next year. Designed to assist the development of vocational skills and training across Europe, including work placements for trainees, the Leonardo Programme has a budget of €1.75bn, which is helping to encourage UK organisations to work with their counterparts abroad. In what is expected to be another challenging year for employers in the UK automotive sector, S&B’s Chief Executive, Jon Winter, claims that the exchange initiative will bring many benefits to the Academy and its apprentices: “In a world of global automotive brands, it’s important for our learners to understand the international context of the industry they have chosen to make their career. This new exchange programme will enable apprentices and Academy staff alike to achieve a better understanding of the challenges and opportunities within the automotive arena in Europe. With the Academy’s influence also extending to the USA and Asia, there’s every possibility that this initiative could move further afield in the future.” Continued Winter: “The need for skilled technicians across the world is on the increase and we actively encourage our apprentices to look at broader horizons during their training. Many of them have already learned the phrase ‘Vorsprung durch Gelehrtheit’, quite simply, ‘Advancement through learning.” In the 2010/11 academic year, S&B doubled the number of successful Apprenticeships over the previous year with some 350 apprentices graduating from the Academy. At the same time, achievement levels reached an all-time high with an overall success rate of 85%. For those learners on the Advanced Apprenticeship three-year programme, success rates were even higher, at over 98%. PHOTO CAPTION: As part of their exchange visit, S&B Automotive Academy arranged for the German apprentices to visit Hampshire bus operator, Bluestar, at its Barton Park depot. The students are pictured with S&B’s Andy West (3rd right) and Steve Prewett, Bluestar’s Area Engineering Manager (2nd right). Ends http://www.sandbaa.com