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Car sales short of target

Mary Fagan,Industrial Correspondent
Tuesday 06 September 1994 23:02 BST
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PRIVATE buyers deserted the new car market last month, causing sales to fall far short of the 500,000 some manufacturers had hoped for, writes Mary Fagan.

Sales of new cars rose 2.81 per cent year-on-year to 452,566, also well short of an official industry forecast of 475,000, after an 18 per cent rise in August last year.

The Society of Motor Manufacturers and Traders said sales to private buyers fell 4.4 per cent in spite of extensive marketing. The fall is worrying because a 1 per cent drop in July new car sales was thought to have been caused by private buyers holding back for 'M'-registered cars.

The small rise in August sales was fuelled by a sharp increase in fleet car sales, up 18.2 per cent in the month and 16.1 per cent in the year so far compared with the same period of 1993.

Ernie Thompson, chief executive of the SMMT, said: 'Clearly, the significant growth we have seen this year has faltered in August. In particular, the underlying confidence of many private customers remains fragile. There was no customary second wave of demand in the second half of August as comment on a probable rise in interest rates became more persistent.'

The Retail Motor Industry Federation said the disappointing sales reflected concern about the extent and duration of the economic recovery.

It urged the Government and opposition parties to reassure consumers so that industry efforts to stimulate the market were not thwarted.

Separately, the SMMT said sales of commercial vehicles grew almost 20 per cent in August to 37,259 and 16.28 per cent in the year so far.

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