FLINT, UNITED KINGDOM--(Marketwire - Feb. 10,
2010) -
After
a tough year, the UK car market recorded a buoyant end to 2009, with many
motorists taking advantage of the vehicle scrappage scheme and the reduced VAT
rate to pick up some good deals. However, with the scheme scheduled to end in
February and VAT having been put back to the original 17.5% rate, analysts are
predicting tough times ahead for the motor trade.
New
car registrations in December were up by 38.9% from the previous year's figures
to 150,936 cars. Despite this, total sales for the year were down 6.4% to
1,994,999 units, the lowest level since 1995. Small cars proved to be the most
popular, with the Ford Fiesta being December's top seller. Meanwhile, budget
manufacturers such as Hyundai and Kia increased their market share,
demonstrating the demand for affordable motoring.
Despite
a positive end to 2009, experts are predicting that sales in 2010 could fall to
as low as 1.7 million units, as the economy continues to struggle. This will not
be helped by the end of the scrappage scheme and VAT hike, which will deter
many motorists from replacing the vehicles. With a general election due in May,
however, the political landscape could change and may see the re-introduction
of scrappage allowances. In the meantime, dealers will have to work hard to
attract sales, as a spokesperson for motor trade insurance
specialists Staveley Head explains:
"With
the end of the vehicle scrappage scheme and VAT returned to its usual rate,
those in the motor trade are going to have to work hard to encourage sales
throughout 2010. This will include offering heavy discounts and attractive
finance packages, in order to encourage more people to buy."
Staveley Head have over 15 years experience in the industry and
provide motor trade insurance for organisations across the UK. Offering cover
from a panel of leading insurers means that the firm can offer the most
appropriate cover for clients, at the most affordable prices. To find out more,
visit: http://www.staveleyhead.co.uk.