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Editor’s Blog

Sales figures cloud market direction

With April car sales looking set to remain at 2007 levels, carmakers and dealers are unclear where the market will head as the UK economy continues to tighten. Official SMMT figures are due to be published this week but it is understood that April 2007 sales of around 170,000 units will be matched or slightly exceeded. An SMMT spokesman said his organisation had been “surprised” by how the market was holding up. “We’ve not seen the drop off you might expect,” he said. One industry watcher said economic uncertainty was making it difficult to predict sales for the rest of this quarter. “A lot of people are waiting to see what’s going to happen with the banks. There isn’t a consistent picture,” said one source, adding that the sector was unclear how healthy the market would be “in two or three months.” He said that dealers had noticed a fall in showroom footfall “but the people going in are looking to buy.” He suggested that vehicle makers which had used discounting to sell cars when the economy was perceived to be stronger could find their profitability squeezed still further, as buyers demanded deeper price reductions. As economic conditions have worsened, car makers have also been accused of getting round rules to prevent pre-registering new vehicles to boost volumes.

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