Exceptional performance from UK manufacturing leads to suspicion in global markets
6 August 2012
Commenting on the latest car registration figures from the Society of Motor Manufacturers and Traders, which show a 9.3% increase to 143,884 units compared with July 2011, David Raistrick, UK Manufacturing Leader at Deloitte said:
“The continuing growth in new car sales in the UK, compared to increasing pressure due to tough economic conditions, which is resulting in reducing sales elsewhere, is starting to raise questions in global markets. This has led to recent suggestions from both retailers and industry insiders that an increase in pre-registration of new cars is perhaps distorting the level of growth being reported in the UK market, particularly in respect of private sales. Official data shows that recorded pre-registrations are up 76% on the first six months of 2011. Whilst the numbers of vehicles are not material to the overall new registrations being reported, it does raise the question as to what is driving the increase.
“Germany is the only other major European market to have shown growth over the first six months of the year but the recent disclosure that nearly 500,000 pre-registrations had taken place in the first six months of 2012, representing 3 out of every 10 new registrations, has raised the spectre that the German new car market is actually in recession. Indeed, our analysis is that that German market has probably suffered a 5% decline during 2012.
“Whilst the practice provides a short term fix for the manufacturer by moving units into the retail sector, the long term effect can only be to undermine residual values and potentially damage brands.”
Sue Robinson, Director of the RMI National Franchised Dealers Association (NFDA) comments:
“In light of speculation about the new car market the NFDA, representing franchised car, commercial vehicles and motorcycle dealers, are carrying out an review of the registration figures to a ascertain a more transparent view of the market.”
In this press release references to Deloitte are references to Deloitte LLP, one of the country's leading professional services firms.
Deloitte LLP is the United Kingdom member firm of Deloitte Touche Tohmatsu Limited (“DTTL”), a UK private company limited by guarantee, whose member firms are legally separate and independent entities. Please see www.deloitte.co.uk/about for a detailed description of the legal structure of DTTL and its member firms.
The information contained in this press release is correct at the time of going to press.
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About the RMI
The Retail Motor Industry represents the interests of operators in England, Wales, Northern Ireland and the Isle of Man providing sales and services to motorists and businesses. The RMI has a formal association with the independent Scottish Motor Trade Association which represents the retail motor industry in Scotland.