UK car sales have fallen at the fastest rate since 2010 as the rise in prices hit the market for new vehicles.
A report published by the Society of Motor Manufacturers and Traders showed a 19.8 percent decline, with only 152,076 new cars registered last month.
Analysts have said that the decline in new cars purchased is a blow to the industry and is partly due to a cut in green subsidies by the government.
“With the rush to register new cars and avoid VED tax rises before the end of March, as well as fewer selling days due to the later Easter, April was always going to be much slower,” said Mike Hawes, SMMT chief executive.
“It’s important to note that the market remains at record levels as customers still see many benefits in purchasing a new car,”
“We, therefore, expect demand to stabilise over the year as the turbulence created by these tax changes decreases,” he added.
Samuel Tombs, the chief UK economist at Pantheon Macroeconomics, said: “Private car registrations plunged in April because vehicle excise duty (VED) rose sharply for cars purchased after April 1,” he said.
Car sales have been the significant boost needed to the economy following 2014, where sales proved to be a significant part of GDP growth.
Director of the National Franchised Dealers Association, Sue Robinson, said the slump in sales was not surprising.
“April is always one of the weakest months for new retail but with record low interest rates and record high employment levels consumer demand remains high,” she said.
The car industry is one to be considered most at threat from a hard Brexit, due to dependence on foreign employees and the global exposure.
The UK’s best-selling car in April was the Ford Fiesta (NYSE:F), followed by the Nissan Qashqai (OTCMKTS:NSANY), Mercedes-Benz C Class, the Mercedes-Benz A Class and the Ford Fiesta.