UK Car Sales Suffer Despite New Car Scrappage Scheme
The Government's £300m car scrappage scheme seemed to have failed and had no real impact on the new car sales after we saw a 24% decrease in new car sales last month.
The Government's car scrappage scheme is a system that provides consumers with £2000 if they scrap a car that's over 10 years old for a new model. These scheme launched in May and strated hitting road bumps from stage one. There were arguements over costs which lead to Ford holding off on their involvement.
Yet another month of low car sales means that the UK has now seen a steady decrease in car sales over the last 12 months. There has been news that consumer confidence is recovering slightly, however, with these new sales figures, it simply weakens that idea.
The Society of Motor Manufacturers and Traders announced that a total of 35,000 new cars had been ordered through the new scheme, however it will take some time to transfer these sales into new registrations. They also used the excuse that a huge number of consumers are looking around to try and get the best offer before buying a new car, this could just be a way of giving the scheme some extra time to prove that it wasn't a complete waste of money.
134,858 were sold in the UK last month with the Ford Fiesta coming out on top with the most amount of sales. 15,386 of those sales are from Vauxhall who had a bad May sales where they suffered from a huge 40% drop in sales.
The amount of corporate sales has had a major affect on the number of new car sales in May. Car leasing companies that offer a range of makes, such as Vauxhall leasing and BMW leasing, are reducing the amount of cars they are buying because they are also suffering from the economic crash.
A number of leasing companies are losing sales because consumers are forgetting about the leasing options which tend to be cheaper than buying a new car. Plus, with the new scrappage scheme encouraging people to buy a car rather than consider the other options that are open to them.
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