Slump in sales forces car industry to urge rate cuts
The impact of credit crunch has shaken car industry as the sales slumped by more than 20% in the last month. The sales touched the lowest figure since 1999 and were less by more than 120,000 units below the March sales.
According to the Society of Motor Manufacturers and Traders’ chief executive Paul Everitt, new car registrations were down for the fifth consecutive month and were indicative of most serious economic conditions faced by the car industry in 17 years.
The automotive retailers normally make 17% of their annual sales in the month of September, but the situation this year is quite contrary to the trend. Industry is therefore forced to urge cut in the interest rates hoping that buyers would be encouraged to resume buying.
The month-to-month fall of 21.2% in September registrations meant decline of 18.8% in last 3 months, while SMMT has predicted full year fall of 2.26% with further decline in the year 2009.
Leading manufacturers Vauxhall and Ford witnessed fall of 16.5% and 23% respectively in September sales, while Land Rover, Bentley, Renault and Porsche were the biggest sufferers with the only exception of Jaguar in the Luxury segment which registered moderate increase in sales.
SMMT has sought government’s help for the car industry which provided employment to 850,000 people. Everitt suggested scrapping of plans for unfair hike in car tax.
The shadow transport secretary Theresa Villiers wanted government to wake up and ensure that regulatory climate did not put the UK’s most important vehicle industry into worst situation.
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