The new car market fell for a sixth
successive month in October. The decline was the steepest recorded
so far in 2008 and was more like to the falls reported in 1991.
Registrations over the past three months have fallen by 21.4 per
cent, and figures are down by 184,541 units over the first ten
months of the year. The SMMT has revised the full year 2008
forecast of the new car market down to 2.15m units, a 10.7 per cent
year-on-year decline.

Tony WorthyThe market is forecast to fall to 1.92m units in 2009. The
overall weakness in the market is most prominently felt in the
private and business sectors, but fleet demand has also come
unstuck in recent months. The mini segment was the only sector to
post growth in October, although supermini volumes continue to
attract a larger share of the market. “October has proved another
difficult month for the UK motor industry and action is needed to
help restore consumer confidence and encourage buyers back to the
showrooms,” said Paul Everitt, SMMT chief executive.

There will be significantly fewer car retailers operating in the
UK in the years to come, as a result of vehicle manufacturers
tightening control over dealership standards, according to analysts
PricewaterhouseCoopers. Chris Kent, a director in the automotive
team at PricewaterhouseCoopers, said that many more dealers are
expected to follow those that have already closed their doors this
year. “Manufacturers have introduced ever-stricter standards for
those who hold franchise agreements, in an effort to exercise
closer control over their brand’s corporate identity,” said Kent.
“Such restrictions will cause some dealers to resign the franchise
while others will be forced out, leading to a smaller pool of
businesses representing each marque. Competition for sales will
remain fierce, however, with a broader range of car brands chasing
what may well be a dwindling number of prospective buyers.”

  • Inchcape is to cut jobs across the UK due to falling sales. The
    firm, which employs about 6,000 people in the UK, said it was
    unable to say how many positions would go as part of its plans to
    reduce costs by £50m. UK like-for-like sales fell 11 per cent in
    the three months to 30 September, against a year earlier, and
    Inchcape warned that profits would be lower than expected. The
    company runs dealerships for a number of carmakers, including Audi,
    Mercedes-Benz, Toyota and Mazda. Inchcape said that as a result of
    the falling sales, its profits would now be less than previous
    market estimates this year, while 2009’s would be “significantly
    lower”.
  • Over a third of used car buyers are looking to counteract
    rising motoring charges and challenging economic conditions by
    downsizing to a smaller, more cost-effective car. In a survey
    carried out this month on http://www.glass.co.uk/, 38 per cent
    of buyers cited fuel prices and rises in road tax for
    heavier-polluting vehicles as factors motivating them to swap their
    car for a more compact and efficient model The poll also revealed
    that a growing number of motorists are switching to diesel as a way
    of cutting running costs. Of those surveyed, 29 per cent stated an
    intention to exchange their petrol vehicle for a diesel model,
    expecting to take advantage of significant reductions in CO2
    emissions and fuel consumption.