Car sales back on course for recovery

THE RECOVERY in UK car sales resumed its course in May as registrations rose by 12 per cent compared with the same month last year.

The May increase in sales to 136,389 means that the car market has risen year-on-year in all but one of the past seven months - confirmation that the industry is moving slowly but steadily out of recession.

Sales in April had unexpectedly slipped back 2 per cent on the level a year earlier. The decline was attributed to unusually strong demand in April 1992 because of Budget tax cuts.

Roger King, director of public affairs at the Society of Motor Manufacturers and Traders, said: 'After the slight blip last month the encouraging trend in registrations suggests that the recovery is still under way.'

Sales over the first five months of the year are running at 725,000, nearly 9 per cent ahead of 1992. If that rate is maintained for the rest of the year the market will end 1993 about 160,000 units higher at 1.76 million.

In a bid to cash in on the recovery in car sales Ford and Rover have both launched fresh marketing ploys in the shape of money-back and exchange offers to disgruntled customers. Last night Vauxhall followed suit with a deal, starting on Monday, that will allow retail and small fleet buyers to swap new vehicles within 30 days, subject to conditions.

Last month Ford just hung on to market leadership with a 20.55 per cent share of total sales compared with Vauxhall's 19.46 per cent. Rover remained in third place although its market share declined by almost 2 points from 16.3 to 14.5 per cent.

Meanwhile, as the Prince of Wales officially opened Toyota's UK factory at Burnaston, near Derby, the Japanese manufacturer confirmed that output from the plant would reach 100,000 in 1994 - a year ahead of schedule. Toyota may also build a second model at the pounds 700m factory in addition to the Carina E. Production will eventually reach 200,000. Prince Charles was introduced to such Japanese concepts as kaizen - continuous quality improvement - which will become everyday language for the 3,000 workers at Burnaston. In return he stressed the need to encourage the brightest students into industry.