August car sales on track for new record

Sales of "R" registration new cars soared by 18 per cent in the first 10 days of this month, putting the industry on target for a record-breaking August sales of well over 500,000.

The internal industry figures, sent to car companies yesterday by the Society of Motor Manufacturers and Traders, showed 208,000 registrations were recorded in the 10-day period, well ahead of even the most optimistic industry expectations. The figures are seen as a clear guide for the whole of August because so many cars are ordered by customers before the start of the month.

Car industry analysts were last night raising their forecasts for this year's August bonanza and predicted sales above the previous August peak of 500,112 in 1989. Some bullish manufacturers had already privately forecast 520,000 registrations this month, but some analysts suggested they could reach 550,000. It could also push sales this year to more than 2.1 million, though they would still be some way off the 2.3 million peak in the boom year of 1989.

Other forecasters were more cautious, pointing to the fact that August this year includes one less selling day than in 1996. Another factor was the trend for customers to "pre-order" cars before the start of the month, which could see sales in the remaining 20 days tail off more sharply.

Last year August was a disappointing month for the industry, with a modest increase in sales to 479,407. Dealers blamed the lack of interest from private buyers, though this year demand has apparently been boosted by building society windfalls and buoyant economic confidence.

But yesterday's figures painted a gloomier picture for "traditional" market leaders such as Ford, which saw its market share plunge to 16 per cent in the first 10 days. It followed a disastrous July for the US giant, which took less than 12 per cent of the British market, one of its lowest figures for decades.

Ford has this year cut incentives to dealers and has retreated from offering big discounts to customers. The company had forecast a modest August this year of less than 495,000 registrations, but has been apparently caught out by demand for other makes.

In contrast, Renault, the French group which has seen its sales surge this year on the back of new model ranges, has gained 7.1 per cent of the market in the first 10 days. Analysts predicted that imports could take a higher share of the market, possibly matching the 70 per cent recorded in July.

Separately, industry sources yesterday warned that the Society of Motor Manufacturers and Traders was having trouble processing the registration data, blaming the unexpectedly strong demand and a new computer link which connected some manufactures. The new computer system is understood to have temporarily failed on the first day of this month. The SMMT has previously denied speculation of problems with its data-processing systems.

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