August saw the sale of new cars fall for the fifth consecutive row, the biggest stretch in sales decline since 2011.
According to the Society of Motor Manufacturers and Traders, there were 76,433 new car registrations last month, which is down 6.4 percent from August 2016.
“Superminis and small family cars remained the most popular types in August, accounting for more than half (58.3 percent) of registrations. However, SUVs, larger family cars and executives were the only segments to grow, up 7.9 percent, 2.2 percent and 1.1 percent respectively,” said the Society of Motor Manufacturers and Traders.
The continued decline in sales is suspected to be due to the uncertainty surrounding Brexit and the possible levies on diesel cars. Demand for diesel cars has fallen by a fifth.
“August is typically a quiet month for the new car market as consumers and businesses delay purchases until the arrival of the new number plate in September,” said SMMT chief executive Mike Hawes.
“With the new 67-plate now available and a range of new models in showrooms, we anticipate the continuation of what are historically high levels of demand.”
Carmakers including Ford (NYSE:F), Vauxhall, Renault (EPA:RNO), Toyota (NYSE:TM) and Volkswagen (FRA:VOW) have launched scrappage schemes, which are likely to boost sales for the month of September.
Samuel Tombs of Pantheon Microeconomics said: “August’s sharp fall in private registrations shows why dealers have suddenly launched scrappage schemes,”
“In theory, these financial incentives could stem the downward trend in sales. But in many cases, the scrappage schemes replace discounts that were available to all buyers, and many owners of old cars might not be able to afford the monthly repayments for a new vehicle.
“Scrappage schemes might turbocharge sales for a few months, but low consumer confidence and deteriorating affordability due to the weak pound suggest that the mid-2010s boom in car sales has run out of mileage.”