New Car Registrations in UK fall 30.9% in January; Industry Urges UK Government to Provide Scrappage Incentives to Boost Demand
05 February 2009
The new car market in the UK continued to decline sharply at the start of 2009, with volumes down by 30.9% to 112,087 units, according to figures from the UK’s SMMT (Society of Motor Manufacturers and Traders). SMMT expects the market to decline by 19.3% in 2009 to 1.72 million units. This would be some 410,000 units off the 2008 total and almost 685,000 units down on 2007.
In January, diesel penetration rose 0.7 percentage points to match its second highest level ever (45.6%), but diesel volumes still fell by 29.7%. Alternatively fuelled vehicle (AFV) demand showed a particularly sharp decline, down 47.4%, in part reflecting strong growth in 2008.
All segments showed falling volumes in January, except the mini segment, which was up 40.8%. Supermini demand slowed less steeply than in other segments to post a market share up almost five percentage points to 35.6%.
All sales types fell in January, although the fall in the private sector was less steep, perhaps reflective of the VAT cuts but more likely that the private sector had already begun to decline in January 2008, the SMMT suggested.
The new Ford Fiesta was the top selling model for a third successive month in January.
There is a clear need to stimulate demand for new vehicles in the UK market. A number of EU member states have launched scrappage incentive schemes, which have the benefit of boosting consumer confidence and delivering significant environmental improvements. The UK motor industry is urging UK government to introduce a similar scheme and help sustain jobs and businesses throughout the sector.
—Paul Everitt, SMMT chief executive
Scrappage schemes in other European countries include:
| Country | Vehicle Criteria | Incentive |
|---|---|---|
| Austria | More than 13 years old | €1,500 to purchase a new car with Euro 4 as minimum engine specification. |
| France | More than 10 years old | €1,000-2,000 to purchase a new car which is less than 160 g/km or an LCV. |
| Germany | More than 9 years old | €2,500 to purchase a car up to 12 months old with Euro 4 as minimum engine specification. |
| Greece* | No age limit | €400-800 to scrap vehicle plus €1,500-3,400 if purchase a new vehicle. |
| Italy* | More than 10 years old | €1,500 to purchase a car which is at least Euro 4 engine specification and emits less than 140 g/km for gasoline and 130 g/km for diesel. |
| Portugal | More than 10 years old | €1,000-1,250 for a car which emits less than 140 g/km. |
| Romania | More than 10 years old | €1,000 to purchase a car. |
| Spain | More than 10 years old or with more than 250,000 km | Up to €10,000 0% loan to purchase a new car or LCV. The car must cost less than €30,000 and emit less than 140 g/km. The LCV must emit less than 160 g/km. |
| * Proposed scheme | ||
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