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The struggling auto industry received a much-needed boost today, after new car sale figures rose for the first time since April last year.
More than 157,00 new cars were registered this July, beating forecasts and showing an increase of 2.4% on the figure at the same time last year, according to the Society of Motor Manufacturers and Traders (SMMT).
The trade body attributed the rise to the Government's “cash for bangers” car-scrappage scheme, introduced in May, which gives people who trade in an old car for a new, fuel-efficient model a £2,000 discount. But it said the sector is still a long way from recovery.
The SMMT's chief executive Paul Everitt said: “The impact of the scrappage scheme is clear and we are encouraged by the positive impact it has had, increasing new car registrations for the first time since April 2008. The industry still faces a long road to recovery and we urge Government to take action to sustain economic recovery through easing access to finance and credit and delivering the loan guarantees set out by the automotive assistance programme.”
Year to date new car sales are still down more than a fifth, a fall of 550,000 from the same period last year.
The car scrappage scheme could run out of cash in as little as three months. It was planned to run until the end of February or until the £300 million invested by the Government has been used up. In the first 10 weeks of the scheme, 144,308 cars were sold. That rate would see the cash running out by October.
