Scrappage scheme slows fall in new car sales

(Darren Staples / Reuters)

The Government's "cash for bangers" car-scrappage scheme is slowing the decline in new vehicle sales, figures out today revealed.

The number of new cars sold in the UK last month totalled 176,264 - a 15.7 per cent drop on the June 2008 figure, the Society of Motor Manufacturers and Traders (SMMT) said.

But the month-on-month fall was the smallest since July 2008.

The car-scrappage scheme - in which owners of cars more than 10 years old get £2,000 off the price of a new motor when they trade in their old vehicle - was introduced on 18 May, so the June figures represent the first full month when the initiative was in operation.

SMMT chief executive Paul Everitt said today: "We are now beginning to see the positive impact of the scrappage scheme translate into new vehicle registrations.

"We expect the pace of improvement to increase in the coming months, but we can already see the industry making steady progress on the long road to recovery."

In April the SMMT predicted June sales would fall to around 153,000 units. so the actual June figure was about 15 per cent higher than anticipated.

Significantly, private buyer registrations were up 3.9per cent last month, the first rise in this sector since November 2007.

Also, demand for small cars picked up with the mini segment showing a huge 145.4 per cent growth and superminis taking a record 37.2 per cent share of the market.

Even despite the more encouraging figures for June, sales for the year so far are still 25.9 per cent down on the total for January-June 2008.

These were the top-selling cars in June 2009:

1. Ford Fiesta
2. Ford Focus
3. Vauxhall Corsa
4. Vauxhall Astra
5. Peugeot 207
6. Mini
7. Volkswagen Golf
8. Ford Mondeo
9. Vauxhall Insignia
10.BMW 3 Series