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The surprise 1.5 per cent interest rate cut was a rare piece of welcome news for dealers and showed the Bank of England had listened to the concerns of UK businesses.
The widely discredited banking sector must now redeem itself and pass this cut onto hard pressed consumers; a move which some banks have not been quick or eager to do after recent cuts.
Whether the cut will make a difference is impossible to tell in the current climate.
It will prompt many buyers into thinking about a new car purchase; getting them to make the quantum leap back into showrooms is another matter.
The cut came as the true weakness of the new car market was revealed. October’s figures ranked as the worst fall in recent memory with all but three brands – Dodge, Volvo and, curiously, Jaguar – recording falls.
Sales dropped by almost a quarter on 2007’s figures and prompted the SMMT to once again reforecast downwards with year-end sales now expected to just about creep past 2 million.
A particularly worrying trend is a further decline in the fleet market. While the private and small business sectors have suffered over recent months the fleet sector, the largest of the three, has looked more robust. That is no longer the case.
With the number of dealers going out of business rising we can only hope this cut is not too much too late.