Car sales: A rocky road ahead for industry
AT last, there’s something Britain does better than the Germans: selling cars. New car registrations in the UK rose for the twelfth successive month in June, up 10.8 per cent year-on-year – an increase that shouldn’t be sniffed at. The growth is less robust than it was in the first half of the year, when registrations climbed 19.9 per cent; but the car industry has been pulled off its life support machine (the scrappage scheme) and lives to tell the tale, for a little while longer at least.
Over in Germany, car registrations collapsed in June, down 32 per cent on the same month last year, with year-to-date sales of 29 per cent. That doesn’t bode well for the picture in Britain, which withdrew its stimulus for the industry after Germany. Still, there’s a ray of light in the British figures: fleet buyers rather than private individuals are driving the growth. Fleet sales were up 25.3 per cent while business sales were up by 18.4 per cent (private sales actually dipped 3.3 per cent). That suggests business confidence is improving, which can only be good news for the nascent recovery.
Still, the global outlook for the big manufacturers is far from rosy. The growth in car sales in China is slowing, along with just about every other economic indicator, while the restructuring of some makers simply hasn’t been radical enough. Hopefully business investment, which was held back during the recession, will keep things ticking over in the near future. But there’s a rocky road ahead.
david.crow@cityam.com