P-reg car sales geared to beat 1989 record levels

Sales of "P" registration cars this August could break through the half a million barrier for the first time since 1989, the dealers' association forecast yesterday. The National Franchised Dealers Association originally predicted sales of 475,000 cars in this year's bonanza, representing a small improvement on 1995, but is now expecting a much bigger increase.

Alan Pulham, the association's director, said: "The forecast is based on improving consumer confidence. We've got a feel-better factor at long last. It's been helped by maturing Tessas and rising house prices. There's no doubt that retail confidence is improving."

August accounts for almost a quarter of annual car sales, causing headaches for manufacturers, but excitement for customers. The sales record was set seven years ago, when just over 500,000 cars were offloaded to the public. During the recession sales slumped to a low point of 367,000 in 1991, before recovering steadily to last year's total of 469,000.

Individual dealers who were taking orders for "P" registration models last night were more cautious. Richard Smith, chief executive of Cleckheaton Holdings, a West Yorkshire firm which runs three garages, explained: "I agree that maturing Tessas are definitely having an impact on private buyer sales. However the outlook is mixed. Rover and Vauxhall are fairly bouyant, but we are rather disappointed with the outlook for Ford."

The consensus among manufacturers is for sales of around 490,000, an increase of just under five per cent. This forecast is echoed by one of the largest dealer groups, Lex Service.

However, the telling factor will be whether sales remain bouyant later in the month, or begin to slacken off after the initial flood of orders.

Vauxhall, agreed with the association's prediction for a greater improvement this year. It attributes the rising trend to a greater variety of payment options rather than heightened consumer confidence. Deals where customers pay half the value of the car up-front and the rest several years later have become increasingly popular, but are not so helpful for the profitability of manufacturers.