Fall in new car sales | Starkwood Media Group

20% fall in new car sales

Sales of new cars plunged
4th May 2017

Based on year on year figures, in April 2017, sales of new cars plunged nearly 20%, this fall has been said to have happened due to customers bringing their purchases forward to avoid the rise in Vehicle Excise Duty (VED)

The Society of Motor Manufacturers and Trade said 152,076 new cars were registered in April 2017.

However, new car registrations are up 1.1% overall for the first four months of the year to a record 972,092.

Is the fall in sales purely down to the VED changes or are there other factors to consider?

The fact the fact that private buyers are seeing prices rises faster than their wages, this has shown the biggest fall in demand (-28.4%). Could this indicate a more subdued car sales ahead?

Also the headlines regarding diesel may be a contributing factor. Around 25,000 fewer diesel cars were registered in April 2017 compared to April 2016. Saying that, larger cars tend to be diesel engines and they were particularly hit be VED changes.

Since 1 April, only newly-registered cars with zero emissions have been exempt from paying VED, which only includes electric and hydrogen cars. However, petrol cars with carbon dioxide emissions of up to 100g per km, registered before this date, are also exempt.

There is a sliding scale of charges for the first year of ownership, and after that petrol or diesel vehicles are subject to a "standard" rate of £140 a year.

For those buying cars costing more than £40,000 there is an additional £310 "premium" levy for the first five years of ownership.

SMMT chief executive Mike Hawes said he expected demand to stabilise this year.


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