Arthur Daleys gain from the domino effect

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The Independent Online
Hundreds of Arthur Daleys parading their wares on used car lots could be the biggest winners from building society windfalls, according to industry analysts who point to a domino effect feeding through to new car showrooms, writes Chris Godsmark.

Car dealers are predicting record sales in this month's R- registration bonanza of more than half a million, but most are cautious about pinning it on building society windfalls. Lex, one of the biggest dealer groups, said the greatest impact was on the used market, with bonus winners buying newer, more expensive, second-hand cars.

The impact is thought to be one reason behind a steady rise in used car prices, though another, much longer-term contributor is that the cars are better put together and last longer. Because used prices generally are going up, some people trading in their old cars have been tempted to buy new ones for the first time.

Even without the windfall effect, the general boost in consumer confidence means new car sales are likely to match or beat the peak of 500,112 August registrations at the top of the last boom in 1989. August last year was disappointing for the industry, with 479,000 P-registration sales.

But windfall winners hoping to walk into dealers this week and order an R-registered car could be disappointed. Stocks of Audis, BMWs and even more mundane models have already been snapped up.