April figures show continued UK car sales growthThe UK may have avoided the embarrassment of a triple dip recession by the skin of its teeth according to figures released in April but the car industry provided far cheerier news for the economy. Figures just released for April show that car sales in the UK jumped by 15% in April this year compared to the same month in 2012.
The UK may have avoided the embarrassment of a triple dip recession by the skin of its teeth according to figures released in April but the car industry provided far cheerier news for the economy. Figures just released for April show that car sales in the UK jumped by 15% in April this year compared to the same month in 2012. The figures show that the car industry continues to outperform the rest of the UK economy while at the same time providing a welcome contrast to the continuing decline in car sales across Europe.
Figures for the first four months of the year in total also show a marked increase, with a 9% rise compared with 2012. An analysis of the figures shows that it is sales to private buyers which are the driving force behind the increase. Private sales have jumped an astonishing 32% in April when compared with last year. It seems that British motorists are being attracted back into the showrooms by discount deals on new cars in conjunction with the availability of attractive car finance packages. The rising cost of fuel may also be having an unexpected positive impact on new car sales, as motorists opt to buy more fuel efficient models to cut their motoring costs.
Industry observers are also pointing to a pent-up demand to explain the rise in new car sales. IHS Global Insight analyst, Howard Archer, for example said: "We've had bad economic times for an extended period. A lot of people have delayed buying new cars, so more and more people are getting to the stage where their cars have had it". The news is an encouraging sign for the UK economy which elsewhere is close to stagnant. Archer added: "It does lift hopes that consumers are prepared to spend on big items".
Archer did however point out that the car industry has been outstripping the wider economy for several years without a huge impact on the growth figures for the general economy. Last year, for example, car sales rose by 5.3% with the economy growing by only 0.3%. Looking ahead, Archer warned against the effects of inflation and low wage growth. He added: "A serious concern for the industry is that consumers could rein in their spending on big-ticket items over the coming months as their purchasing power is squeezed by higher consumer price inflation and muted wage growth".
Posted by Edwin Miles on