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The UK car market showed further signs of a deepening slowdown on Thursday when data revealed that new vehicle registrations fell in September for the first time in six years. New car registrations fell by 9.3 per cent year on year to 426,170 last month, according to the Society of Motor Manufacturers and Traders. September is traditionally a strong month for car sales because the number on the registration plate changes and drivers rush to buy a vehicle with the latest figure. September was the sixth consecutive month when new car registrations declined, highlighting how vehicle makers are contending with a difficult market after several years of strong sales.Please use the sharing tools found via the email icon at the top of articles. Copying articles to share with others is a breach of FT.com T&Cs and Copyright Policy. Email [email protected] to buy additional rights. Subscribers may share up to 10 or 20 articles per month using the gift article service. More information can be found here.
The SMMT data suggest consumers’ appetite for big ticket purchases may be waning, partly due to a squeeze on living standards propelled by the fall in the value of sterling following last year’s referendum vote to leave the EU. But there is increasing evidence that the British car market, which has been fuelled by generous financing arrangements since the 2008 financial crisis, may have simply come to the end of a strong period of growth. Share on Twitter (opens new window) Share on Facebook (opens new window) Share this chart And sales of diesel cars have been hit by how the Volkswagen emissions scandal in 2015 highlighted how these vehicles play a significant role in air pollution in big towns and cities. New diesel car registrations fell 22 per cent year on year to 170,732 in September. “September is always a barometer of the health of the UK new car market so this decline will cause considerable concern,” said Mike Hawes, chief executive at the SMMT. “Business and political uncertainty is reducing buyer confidence, with consumers and businesses more likely to delay big ticket purchases.” “Car sales are also likely to be hampered by mounting pressure to restrict car finance deals and unsecured consumer credit,” said Howard Archer, economic adviser to the EY Item club. “The Bank of England has shown mounting concern over this and is keen for a more responsible approach to be adapted.” The decline in new car registrations comes in spite of the launch this year of generous scrappage schemes by vehicle manufacturers aiming to reverse the trend of falling car sales. These schemes, under which owners trade in their old cars for discounted new ones, have been partly focused on taking the most polluting diesel vehicles off the road amid efforts by the government and local authorities to improve air quality in Britain’s cities. Consumers are starting to show increasing interest in buying electric cars, which currently constitute a small part of new vehicle sales. Sue Robinson, director of the National Franchised Dealers Association, which represents car dealers in the UK, said one problem for the industry was uncertainty over measures aiming to tackle pollution. “Consumers walking into the showroom need more clarity on issues such as diesel and air quality,” she added.
Source:-.ft.