Private car buyers still wait on the sidelines

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The Independent Online
Sales of new cars rose by 4.5 per cent to 145,710 in February in spite of a continued decline in sales to private buyers, according to the Society of Motor Manufacturers and Traders. The overall increase is the first year on year improvement since September 1994, but the SMMT said that it is no guarantee of a sustained improvement in the market.

Sales to private buyers fell by 3.1 per cent in February and by almost 9 per cent in total in the first two months of the year. Small business sales showed a decline of 4.3 per cent last month while fleet sales rose by almost 14 per cent. The SMMT said that people appear still to be concerned about job security and being able to pay the mortgage, pushing new car purchases by private buyers down the agenda.

Ernie Thompson, chief executive of the SMMT, said:"The increase in registrations is encouraging but with business and fleet sales accounting for 55 per cent of the total, it is clear that private customers are still reluctant to come into the showroom."

"This upturn after a period of five months is most welcome, but it would be premature to assume that any new trend has been established," he added. The SMMT is wary of market projections since sales took their downward turn after last summer.

For the first two months of this year, overall sales of new cars were 343,515, which is down marginally on the same period of 1994. After February's improvement, the SMMT is hoping that it may be able to report an overall improvement for the first quarter. It is unclear, however, how long and to what extent the buoyancy in fleet sales can be maintained.

Imports in February increased their market share to 60.52 per cent from 57.54 in February last year. In the first two months, imports took almost 60 per cent compared with only 55.89 per cent in the same period last year.

The top five sellers were the Ford Escort and Mondeo, the Vauxhall Astra and Cavalier, and the Ford Fiesta.