UK Car Sales in April drop to balance March’s pre tax rise sales bonanza

UK Car Sales dropped in April 2017 by almost 20 per cent, as the bumper sales in March – ahead of the VED tax rises – are balanced out.

In the same way the housing market went berserk when Nigel Lawson flagged up the end of MIRAS by six months in the 1980s, the new car market reacted to a flagged-up increase in VED rates for new cars in April, with car buyers emptying their wallets to deliver record-breaking new car sales numbers in March.

Any artificial incentive to buy which results in record-breaking sales was always going to result in a hangover, and that hangover has seen new car registration in April drop by almost 20 per cent.

But in number terms, the combined new car registration of March and April still come out almost 7,000 units ahead of the total in 2016. So the new car market hasn’t slumped – as many are saying – but simply corrected itself.

To no one’s surprise, the Ford Fiesta continued its run as the UK’s best-selling car in April, but it was followed by the Nissan Qashqai, Mercedes C Class and Mercedes B Class, with the Ford Focus knocked down to fifth spot and the Vauxhall Corsa disappearing out of the top ten altogether,

Mike Hawes, SMMT boss, said:

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.

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.

It seems highly likely the boom in new car sales will continue, for now, despite the gloom mongers. Although there is the likelihood that the government will, before too long, look to rein in sales by making financing more difficult to obtain.